Tata Motors introduces VRS, cuts down hierarchy levels

TIL Desk/Business/New Delhi-Tata Motors, India’s largest automobile maker, has started rolling out a voluntary retirement scheme (VRS) for its employees as part of its organisational restructuring exercise. This is part of a human resources restructuring drive that is expected to transform the organisation into a much leaner company with a flat hierarchical structure. The new structure will be in place from April 1.

So far, less than 500 executives have been offered VRS, which roughly includes one year’s salary, among other benefits, sources said. The company, however, did not confirm the details of the VRS package or how many were offered VRS.

A company spokesperson said: “Tata Motors confirms that as part of the ongoing organisation effectiveness project, where we have already finalised the top two levels of our management structure, a proposal on VRS package has been presented and approved by the board. Since the exercise for selecting L3-L5 is still underway, it is premature for us to comment on any other specifics at this point in time.” From a 15-16-level hierarchy, the organisation is moving to a flat five-level hierarchy.