The government has failed to frame a long-term employment policy, without which there is a danger of disrupting and pressures of the path of development strategies. The employment otherwise would be for a few well-connected individuals.
According to a recent report prepared by the Ministry Labour and Human Resources the unemployment is 2.9 percent, and the country’s youth unemployment stands at 9.6 percent.
This year almost half of the 3,322 university graduates appeared the preliminary examination for 434 vacancies in the civil service. This means at least three graduates will be vying for a slot in the civil service this year. The unemployment figure is rising. According to the labour ministry’s press release, the national unemployment rate has decreased by 0.3 percent in 2014 from 2013, which is not actually true.
The government must now think of absorbing graduates. One of the best ways of giving jobs is to replace old servants with that of new seekers. The labour force participation rate is estimated at 62.6 percent in 2014, (those between 16-45) and they are considered economically active group than who are economically inactive due to old age. One of the techniques of making the workforce is Voluntary Retirement Scheme. This is generous, can be tax-free severance payment to persuade the employees to voluntarily retire from the company, which is called as ‘Golden hand Shake’ as it is the golden route to retrenchment. It can be a better ways of creating jobs for active group of people.
A golden handshake is essentially a severance or kind of compensation made to employee through several ways, such as cash, or stock options, or other incentive packages. It’s an agreement between an employee and employer when they leave jobs or retire voluntary-credit as a retirement incentive. A golden parachute agreement customarily is used as a lure to create jobs and give opportunity to jobs to people in the country. As young people enter jobs, they tend to perform better than old oldies.
Some benefits under this scheme are better emoluments; the employee will get the provident fund and gratuity dues at the earlier year so that he/she can use for house construction, and for family subsistence. It is a lucrative settlement which prevents resentment at the old age. It also offers best and human route to retrenching excess of employee. Sometimes, voluntary nature preludes the need for enforcement.
The people most likely to take advantage of the Golden Handshake(GH) are people who would retire anyway. For example, employees who are more than 50 years old and have more than 25 years of service should be eligible for GH. If this tenure has to be taken in, 1000 or more jobs could be created in a year than 434. Offering the GH might encourage a few additional employees to retire sooner. And those bogus employees opt retirement and for the benefit anyway, and then the new experiencers would result in a higher quality work.
As an alternative to the Golden Handshake, there could be Lump Sum Incentive program in which retirement-eligible employees were offered a lump sum incentive. These can include cash, a house, or stocks options, or other packages for life-long for personal sacrifice of early retirement. For example, an employee at least 50 years old who retires by the close of the fiscal year is offered the opportunity to receive lump sum incentives.