Before discussing the case of महेन्द्र राज पाण्डे बिरुद्ध ने.रा.बैंकको संचालक समिति समेत Case Number: 2677 Decision Date: 2064.08.16 - we should delineate how the amounts under VRS Schemes are defined.
Normally in Nepal the employees are offered as a minimum starting negotiation point - an amount of employer's social security contribution (gratuity, provident fund etc.) for the remaining service period of each employee (had they continued the employment) but not exceeding the agreed maximum number of years. This is not a rule but is followed mostly in practice given the trends. Any amount that is agreed above that maybe negotiated and agreed upon. These could include:
- A payment proportional to each year of past service
- Medical allowance payment depending on the age of the employees
- Enhanced pension plan, if employees are eligible to receive pension etc.
However, there is no defined way on how a VRS amount is negotiated. The negotiation process for a VRS amount can vary depending on the organization's policies, practices, and the legal and regulatory framework of the country. VRS negotiation involves the organization designing the offer with eligibility criteria, incentives, and terms. Consultation with representatives may occur, and eligible employees apply. The organization evaluates applications, potentially entering a negotiation phase, where employees discuss aspects like lump-sum payment and timing. Individual circumstances, such as position and tenure, are considered. Terms are finalized, participants accept, and the organization processes payments. This process varies based on policies, labor laws, and organizational context.