Tata group company Voltas Ltd will announce a voluntary retirement scheme at the end of this month to reduce around 300 more jobs from its Mumbai unit.

The cost of this VRS, at around Rs 22 crore (Rs 220 million), will reflect on the company's profitability this year.

But the company is selling land at Thane, Mumbai, to a private builder for Rs 20 crore (Rs 200 million), which will make up for any impact on the profitability, said a top company executive. The memorandum of understanding with the builder was signed last week, he said.

Voltas also plans to shed another 400 from its Hyderabad workforce through a VRS next year. Employee strength at the engineering-to-consumer durables firm has come down from around 11,000 a few years ago to 3,900 now.

The previous four VRS schemes has saved the company around Rs 52 crore (Rs 520 million) per year, though the wage bill has not changed significantly.

According to Anil J Gole, vice-president, human resources at Voltas, the wage bill today is around Rs 110 crore (Rs 1.10 billion) as compared to Rs around Rs 120 crore (Rs 1.20 billion) five years ago.

"Sometime in between these years, the group had lot focus. It has dipped its hands in too many businesses. But after a lot of organisation changes, including top management changes, we have once again emerged an employer of choice. Several of our past employees are coming back to us once again," he said.

Gole pointed out that as younger professionals are now joining the company in key positions and decisions are being taken fast at the top management level, Voltas has seen a considerable turnaround in the past two years.

This is especially noticeable in the turnaround of the cooling appliances business division, which has become the second biggest air-conditioner maker in the retail segment after LG last year and continues to maintain its position this year.

"But this has its own problems too. Competition keeps a close watch companies which are posting a recovery and try to poach on their employees. As a result, our attrition rate still remains very high at 12-13 per cent. We want to bring this down to below 6 per cent. That is what we are trying to do. Our per employee turnover is also lower as compared to several of our competitors," Gole said.

He added that the reason behind the lower employer turnover ratio is primarily because other companies have set up greenfield facilities in places where they are availing cheap labour.

Voltas is also considering whether it can use the workforce which is to be shed at the Hyderabad facility through a VRS next year in the form of contracted labour during the peak season.