No 'planned layoffs', but pay hikes delayed: Infosys
13 May 2017
Amid a spate of axe-wielding in the Indian information technology sector, the country's second-largest IT services company Infosys has sought to calm employees' fears, saying there were no "planned layoffs" even as it has delayed salary hikes.
The company said there could be performance-based exits as in the past.
"I would like to put to rest any speculation around planned layoffs. As has been the case in the past, we will primarily see some performance-based exits," Infosys chief operating officer Pravin Rao said in an email sent to the company's staff.
Infosys also said the compensation revision for its India employees would be done in July. According to the email, Rao said employees who are in the JL5 band and below, the compensation review will be effective 1 July 2017. The senior employees may have to wait longer for their compensation revision.
The JL5 and lower bands consist of employees like software engineers and team leaders, which constitute around 40 per cent of the total employee strength.
The email comes at a time when IT services firms like Infosys, Wipro, Cognizant and Tech Mahindra, are planning to reduce the headcount. Like Infosys, they all claim the lay-offs are routine and performance-based.
Experts however attribute them to the emergence of new technologies, automation, and visa curbs in their biggest market the US as well as Europe, along with a reduction in growth in the banking and healthcare segments in the US (See: Indian IT mayhem continues; Tech Mahindra joins sacking spree).
"As you are aware, the last financial year was a challenging one; our Q4 results were below expectations, the industry is going through challenging times and our core services business continues to be commoditised," Rao wrote.
Infosys also said it is looking at various opportunities to optimize cost.
"Earlier this quarter we had embarked on a few cost optimisation measures. Based on feedback received from many of you, we have decided to reconsider and discontinue a few initiatives that were causing discomfort," Rao said