State-owned telecommunication company Bharat Sanchar Nigam Ltd (BSNL) is reportedly planning to lay off one lakh employees to cut down costs.
According to Press Trust of India, BSNL is expecting to let go its employees by offering voluntary retirement. Besides the financial constraints of the company, over staffing and lack of skilled employees also forced the company to make the decision.
"Around 1 lakh people in BSNL are in excess of the requirement and the company wants these people to take voluntary retirement," said a top official of the company.
BSNL believes that by bringing down the number of employees it will recover a major share of its profit which is currently paid as salaries to the employees. It is said that 48 percent of the company's revenue went as salaries.
"If these people opt for VRS, the salary burden of the company will come down to 10-15 per cent, which is manageable," official said adding that "Over-staffing is one part which gets compounded by the fact that age is skewed. The average age is about 50 years. These people don't have the skills set that are required for a service provider."
BSNL was under constant pressure since 2004-05 when the revenue of the company started showing a steep decline. Its profit came down to ₹6,384 crore during the 2010-11 period from ₹10,183 crore due to the salary burden and funding for the 3G and BWA spectrum auction.
The company has also drafted a blue print to tap revenue of ₹8,000 crore through monetisation of its real estate. This includes "monetising of towers assets, utilisation of its factories for revenue generation, providing broadband connectivity to schools and leasing out its CDMA network," PTI reported.