RELIANCE Industries Ltd (RIL), which has a tradition of employing and retaining staff with a good track record regardless of their age, is easing out an increasing number of people who have completed the retirement age of 58.

People who were retained even after they reached 58 in Reliance’s growing refinery and petrochemicals business in a booming economy, are also being given the axe, said a senior company official familiar with the new HR strategy. This is being done to reduce manpower costs, he said.

Over 1,000 RIL employees retired in the past three months and more are on their way out, according to company officials.

RIL did not reply to a specific query of Financial Chronicle on the number of people who had retired recently. “We continue to recruit younger people for our retail business across the country as we expand our operations. We also have been recruiting in large numbers from ITIs… for a number of years,” company spokesperson Tushar Pania said.

RIL’s annual report for 2007-08 says the average age of the group’s 48,000 employees is 37 years. About half the staff are below 40 years of age. The flagship, RIL, alone had 25,487 people on its rolls as on March 31 last year. The easing out of older staff will bring the average age down.

The new HR strategy is being executed at RIL’s corporate offices in Mumbai and Jamnagar in Gujarat where the company’s refinery is located. People being retired are mostly in the accounts and purchase divisions where technology takes precedence over manpower.

On December 31, over 25 executives at RIL’s corporate office at Sewri — a central Mumbai suburb -- retired. They were expecting an extension of their services as they had received promotions and salary hikes earlier in the year.

One retiree from the Sewri office said, “I thought I would retire after a few years. My services were indispensable till recently when the economy was riding high. I had got a salary hike last year. When things turned bad in October last year, I was asked to retire.”

Older employees at other locations are also being asked to leave. All this comes amid a manpower rationalisation exercise which has seen several young people in businesses like retail being shown the door.

RIL’s move to let the older staff go is a marked departure from the past. Dhirubhai Ambani, the company’s founder, believed that age was not a handicap. That is why several retired executives from public sector oil behemoths like ONGC and IndianOil were taken on board when RIL set up the refinery in the nineties.

For instance, people like Atul Chandra, who came after retiring from ONGC Videsh, is still heading RIL’s international exploration business. High- profile executives, who belonged to the Dhirubhai Ambani era, are still calling the shots. V V Bhat, the 75-year old head of RIL’s HR division, was part of the old era.

People in recruitment agencies say RIL’s move makes sense since younger executives can replace older ones at a less cost. “This is the right time to get good young people as compensations are not very high,” said Kris Lakshmikanth, managing director and chief executive officer of Headhunters India.

Big business houses like the Tatas, the Aditya Birla group and Essar are also bringing the average age of their employees down. In these organisations, the average age has come down to 40 years at the middle management level. “Companies are becoming young since emerging businesses need young minds and high energy levels,” said Sanjay Jog, human resources head of the Future group.