Bengaluru: Services of the upper middle class are going to be terminated in large numbers soon, with the lower middle class slated to be affected later this year. A retrenchment of this scale has been unknown since the slowdown of 2008. Cognizant is going to lay off about 6,000 Indian employees and start hiring in the US. Capgemini will cut short the tenure of 9,000 employees. India’s own Infosys will ask 1,000 odd workers of Level 6 and above to leave. Wipro has reportedly instructed its managers to look for 10% worst-performing employees who can be removed in the event that the company fails to grow in the near future.
Cognizant has asked directors, associate vice-presidents, senior vice-presidents and 1,000 odd executives to quit their jobs in the name of a “voluntary separation programme” for 2.3% of its total workforce. Capgemini is expected to lay off employees from Igate, the company it acquired in 2015, reducing its workforce by 5%. Level 6 in Infosys refers to group project managers, project managers, senior architects and higher levels. Managers have been asked to identify the bottom 10% of employees at these levels whose performance is the worst of the lot.
Cognizant is camouflaging its intent with euphemism and semantics. A spokesperson of the company explains the terminations as follows:
“Cognizant has not conducted any layoffs. Each year, as is the best practice across our industry, we conduct a performance review to ensure we have the right employee skill sets necessary to meet client needs and achieve our business goals. This process results in changes, including some employees transitioning out of the company. Any actions as a result of this process are performance-based and generally consistent with those we’ve made in previous years. In the March quarter, we hired thousands of professionals — top talent from campuses, as well as from the lateral market.”
Not impressed, 2 groups of IT professionals have approached the Tamil Nadu government’s labour department for redress. The Forum of IT Employees and NDLF IT Employees wing have petitioned the State government against the dismissals at Cognizant. Their case is that a company cannot lay off software engineers on the ground of their lack of performance at a time when technologies are constantly changing and business shifts are not able to cope with the ever-changing demands of clients.
Infosys calls it a routine affair:
A continued low feedback on performance could lead to certain performance actions, including separation of an individual and this is done only after feedback. We do this every year and the numbers could vary every performance cycle.
To be fair to the employers, they have hit a bad patch economically. Cognizant, which was growing at a rate of 20% per annum until recently is now growing at 8-10% a year. The growth rate of Infosys has gone down from 13.3% in 2015-16 to 8.3% this year, which happens to be the rate of growth of TCS too. These and other companies in the IT industry need to cut the jobs because Europe has slowed down its imports from India and the US now has a protectionist government. These factors are over and above automation, which cuts manpower more than the man hours.
Unmoved by the plight of companies with shrinking businesses, the virtual union — this sector does not recognise trade unions officially — called NDLF IT Employees is spreading from Tamil Nadu and Puducherry to Karnataka, Maharashtra and Telangana.