2. Defination
THE GOLDEN HANDSHAKE, IN INDIA, IS
KNOWN AS VOLUNTARY RETIREMENT
SCHEME AND A PART OF EXIT POLICY
IT IS NOW A COMMONLY METHOD USED TO
DISPENSE OFF THE EXCESS MANPOWER
AND THUS IMPROVE THE PERFORMANCE
OF THE ORGANIZATION.
3. REASONS FOR
PROPOSING GOLDEN
HANDSHAKE
RECESSION IN BUSSINESS(WHEN A
COMPANY NOT ABLE TO SUSTAIN THE
PROFIT)
DOWNSIZING
REALIGNMENT OF BUSSINESS –DUE TO
MARKET CONDITION
PRODUCT
TECHNOLOGY OBSOLECENE
4. PROCEDURE
THE EMPLOYER HAS TO ISSUE A CIRCULAR
COMMUNICATING HIS DECISION TO OFFER
VOLUNTARY RETIREMENT SCHEME
MENTIONING THERIN.
1:- THE REASONS FOR DOWNSIZING
2:- ELIGIBLITY i.e. WHO ARE ELIGIBLE TO APPLY
FOR GOLDEN HANDSHAKE
3:- THE AGE LIMIT AND THE MINIMUM SERVICE
PERIOD OF EMPLOYEES WHO CAN
APPLY(EMPLOYEES WHO IS 40 AND ABOVE THOSE
WHO HAVE COMPLETED MINIMUM 10 YRS OF
SERVICE IN THE ESTABLISHMENT.)
5. 5:- THE RIGHT OF AN EMPLOYER TO
ACCEPT OR REJECT ANY APPLICATION
FOR GOLDEN HANDSHAKE
6:- THE DATE UP TO WHICH THE
SCHEME IS OPEN AND APPLICATIONS
ARE RECEIVED FOR CONSIDERATION
BY THE EMPLOYER.
6. BENEFITS
IT SHOULD BE NOTED THAT EMPLOYEES
WHO OFFER TO RETIRE VOLUNTARILY ARE
ENTITLED AS PER LAW AND RULES THE
BENEFITS OF PROVIDENT FUND,GRATUITY
AND SALARY .
THE CIRCULAR MAY INDICATE INCOME TAX
INCIDENCE ON ANY VOLUNTARY
RETIREMENT BENEFITS WHICH ARE IN
EXCESS OF RS. 5 LAKHS, WHICH IS MAXIMUM
TAX FREE BENEFIT UNDER SUCH SCHEMES.
7. MERITS
NO LEGAL CONSTRAINT
ATTRACTIVE COMPENSATIONS
REDUCES CONFLICTS AND
FLEXIBILITY OF SCHEME
COST REDUCTION
8. DEMERITS
FEAR AND UNCERTAINITY FOR
EXISTING EMPLOYEES
COFUSION IN WORKING OPERATION
PROTESTED BY TRADE UNIONS
LOSS OF GOOD EMPLOYEES
9. EXAMPLES
SUICIDE CASES OF VOLUNTARILY
RETIRED PERSONS
DISPARATE JOBS THERE AFTER
FAILURE OF BUSINESS OPENED
THERE AFTER
