Tata Motors Jamshedpur announces VRS 2026 for eligible employees

Mail News Service

Jamshedpur, April 10: Tata Motors Limited, Jamshedpur, has announced the launch of its Voluntary Retirement Scheme (VRS 2026) for permanent salaried employees, effective from April 10 to April 30, 2026.

The scheme is open to employees aged above 40 years as of April 30, 2026, who are on the company’s rolls and fall under the bargainable category.

Temporary staff, trainees, apprentices, fixed-term contractors, and those who have separated under earlier schemes are not eligible.

Under VRS 2026, employees can opt for either monthly payouts or a lump sum amount, calculated as per a defined formula based on basic salary and dearness allowance components.

The package is designed to be among the most competitive in the industry, taking into account years of service and remaining tenure.

In addition to the financial payout, the scheme includes gratuity, leave encashment, continued health insurance coverage, and professional guidance on financial planning and post-retirement preparedness to ensure a smooth and dignified transition.

Under the scheme, employees can choose between two options — a monthly benefit plan or a lump-sum settlement. The first option provides a monthly payout based on the employee’s age as of April 30, 2026.

Employees aged between 40 and 45 years will receive 80 per cent of their last drawn salary, while those aged 45 to 50 years will receive 90 per cent. Employees in the 50 to 55 age group will get 100 per cent, and those aged 55 years and above will receive 110 per cent of their last drawn monthly salary.

The second option offers a lump-sum payment calculated using the Net Present Value (NPV) method. This amount represents the present value of the employee’s expected salary up to the age of 60.

The lump sum will be paid in two installments, with the final payment scheduled along with the June salary.

In addition to these options, employees will also be entitled to other statutory and company benefits. These include Provident Fund (PF) as determined by the Employees’ Provident Fund Organisation (EPFO), gratuity, superannuation benefits where applicable, pension under the EPFO scheme, and encashment of earned leave accumulated up to 2026.

The company has also introduced a group incentive component to encourage participation in the scheme. Employees will receive an additional incentive based on the total number of eligible applicants. If applications range between 299 and 448, each employee will get ₹50,000. This amount will increase to ₹75,000 for 449 to 597 applications, ₹1 lakh for 598 to 747 applications, and ₹1.4 lakh if the number exceeds 748.

Healthcare benefits have also been included in the package to ensure post-retirement security. Employees opting for VRS will be eligible for medical coverage for a period of 10 years from the date of retirement. The scheme provides for hospitalization expenses up to ₹1.5 lakh per person and up to ₹2,000 for home-based treatment.

The company stated that the initiative comes in response to requests from employees seeking voluntary separation to explore personal or professional opportunities.

Employees opting for the scheme will not be eligible for any future wage revisions, settlements, or company benefits once separated from the rolls.

“The VRS package being offered is among the most competitive in the industry and is structured based on years of service and/or remaining tenure. In addition, the benefits include gratuity, leave encashment, continuation of health insurance coverage, and access to guidance on financial planning and post‑retirement preparedness to ensure a smooth and dignified transition. Eligible employees are required to submit their applications within the stipulated window,” said Prantik Chakraborty, Deputy General Manager, Corporate Communications, Tata Motors Commercial Vehicles.