The Uday Kotak-led board of Infrastructure Leasing & Financial Services (IL&FS) is planning to cut workforce across the group by 65 per cent and bring down wage costs by half as it examines various ways to turnaround the infrastructure financier.
In a second report on “Progress and Way Forward”, which has been submitted to the ministry of corporate affairs (MCA), IL&FS has said the new board has taken various initiatives to rationalise manpower, which will lower the wage bill at the group level and lead to savings.
The board has also initiated measures to bring down the operating costs such as termination of non-essential real estate premises. Certain other proposals of sale of non-core assets are being evaluated by the board .
On the steps taken to bring down the wage costs at the group, IL&FS said the board is looking at various measures that include salary rationalisation of employees, doing away with services of retired consultants, “talent restructuring” and amalgamation of roles and responsibilities. It added that these initiatives will be done in two phases.
The first phase will see steps such as salary rationalisation of employees and separation of superannuated consultants. The new board expects these two steps will result in net savings of around Rs 100 crore annually.
The second phase will involve talent restructuring, amalgamation of roles & responsibilities. “These steps will yield an approximately 50 per cent savings in the wage bill of the IL&FS group,” the report said.
BITTER PILL
- Board proposes 65% cut in workforce
- Bring down wage cost by half, through salary tweaks
- End services of retired consultants
- Termination of use of non-essential premises
