After Cognizant said that that it will restructure the company and layoff around 7,000 employees, reports stated that Capgemini laid off nearly 500 employees.

IT employees union says mass retrenchment is illegal warns action
news IT Wednesday, November 06, 2019 - 19:06

Woes of those working in India's Information Technology sector are only growing by the day as companies continue to announce mass retrenchments and layoff of its staff. After Cognizant said that that it will restructure the company and layoff around 7,000 employees, reports stated that Capgemini laid off nearly 500 employees.

Meanwhile, reports also suggested that Infosys is  laying off employees across different levels — 2,200 people who are at the level of senior managers, 4,000-10,000 people at the associate and middle levels, and 50 senior executives.

Given the flurry of decisions which lead to thousands losing their jobs, Chennai-based Union of IT and ITES employees (UNITE) and Karnataka State IT/ITeS Employees Union (KITU) has opposed the move and termed the retrenchments illegal. UNITE further filed a petition before labour authorities and requested intervention.

A statement issued by UNITE on Wednesday reads, "This act of the IT majors are against the law of the land and it is illegal. But the government of India and Tamilnadu are indifferent to these practices. This sort of retrenching employees has become a day to day affair of the IT companies and the labour authorities are silent on this very important issue," alleges UNITE.  "On 05-11-2019 a delegation from Union Of IT & ITes Employees (UNITE) led by its General Secretary Alagunambi Welkin submitted a memorandum to the Commissioner of Labour, Tamilnadu. UNITE requested his intervention on these illegal practices and urged him advise the management forthwith to stop these unlawful practices," stated the Union.

The Karnataka State IT/ITeS Employees Union (KITU) meanwhile termed the management's decision is inhuman.  

" Karnataka State IT/ITeS Employees Union #KITU strongly condemns the illegal and inhuman decision taken by the management of both Infosys and Cognizant. According to the Labour Laws, Companies that employs more than 100 employees need to obtain approval from the Labour department in order to execute layoffs. Rebranding a layoff by arguing that employees voluntarily resigned when they were, in fact, forced to resign, is also against the law. KITU urges all the victimized employees to refuse to resign if asked to do so by the company," it said in a note. 

Companies have, however, attempted to defend their decision, terming involuntary attrition as integral for businesses.

"As a high performance organisation, involuntary attrition is integral to normal course of business and this (sacking) should not be interpreted as any mass trimming across any level in particular," Infosys told IANS.

Involuntary attrition, a term used by the companies for firing or sacking employees for not measuring up to its expectations or high standards of performance, has been taking place at the company over a few quarters.

"This is not laying off, if you don't perform for two years or two quarters or whatever then you are asked to go, it's a performance-related thing," the source told IANS.

Earlier, Infosys announced that its attrition rate annualised consolidated attrition rate stood at 21.7% as on 30 September 2019 as against 23.4% on 30 June 2019 and 22.2% on 30 September 2018. The attrition rate of 23.4% was reportedly one of Infosys’s highest.

However, in the case of Capgemini, Times of India reported that the MNC allows them to be on the bench for 90 days, following which the company moves them to a corporate pool to find projects. Those who couldn’t find projects are the ones who have been laid off, the report stated. 

Editor's note: The article had erroneously said CapGemini is laying off 5,000 people, instead of 500.

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