Essentials for opting for voluntary retirement

'Voluntary Retirement Scheme' is a generous, tax-free severance payment to persuade the employees to voluntarily retire from the company. It is also known as 'Golden Handshake' as it is the golden route to retrenchment and is based on based on the number of years of service put in and the number of years of service left.

Where any such scheme is floated, an employee needs to furnish a notice authority revealing his desire to opt for the same. The authority should approve such voluntary retirement before the expiry of the notice period. Though, an employee has a right to withdraw his voluntary retirement after acceptance, with the approval of the appointing authority, before the expiry of the period of notice.

No request for voluntary retirement can be made by an employee nor, can it be accepted by any employer unless a scheme for the purpose exists. Any order made when such scheme is not operative, will be vitiated.

 

Source: http://business.gov.in/manage_business/vrs.php

 

Also Check: Other Legal Aspects

 

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