Non-Bangalore employees duck Infy axe

Source: BusinessStandard
The lack of tolerance for non-performance at Infosys Technologies Ltd appears to be confined to Bangalore so far. The layoffs and outplacements of some 2,100 staff in mid-March by the Bangalore-based IT firm comprised 3.5 per cent of the 60,000 people who were put through the annual performance appraisal exercise. Of this, just about 0.4 per cent comprised employees based in non-Bangalore centres, according to information given by the company.

“Employees who have been consistently demonstrating poor performance were counselled out. Less than 1 per cent of our 11,250 employees in Chennai and 11,496 employees in Hyderabad have been impacted. As for the Thiruvananthapuram centre, less than 1 per cent of the 1,800 employees were impacted,” said Mohandas Pai, member of the board, director, human resources, Infosys Technologies, said.

Infosys has been following a performance management system wherein employees are categorised into various groups based on performance. People who have the potential or the attitude to improve performance are put on a personal development plan. Otherwise, they are ‘outplaced’ — provided with resources to find a job with another company. “This is a regular process that we have been following for many years,” Pai said.

He did not comment on how the company would be deploying the fresher intake of over 16,000 people planned for fiscal 2010, or how it would affect bench numbers at the company. “The bench strength is around 4,000, of which 1,300 are in internal projects. Our utilisation rate for the March quarter is 74.3 per cent (excluding trainees),” Pai said.

Infosys officials have stressed that all new staff joining the company would be “gainfully employed” on internal and ongoing projects after completion of their training period. Infosys has increased its trainee probation periods from four to seven months, partly to control variable costs and partly in anticipation of a sluggish project pipeline till September this year.

During the fourth quarter of 2009 ended March 31, 2009, Infosys lost four clients, while its top 10 clients slashed their IT budgets by at least 10 per cent. As things stand, the company is trying trying to mitigate the impact of the global economic slowdown by freezing employee increments, bonuses and slashing variable pay, which in the case of many employees at the executive level, constitutes 85 per cent of the salary.

Pai dismissed apprehensions of layoffs happening from among the freshers set to join the company in case the bench numbers increase disproportionately. “Our model does not envisage this (layoffs) at this point of time,” he said.

At an employee count of 105,000 people currently, Infosys has 45,000 trainees on its rolls, and is hiring 16,000 students passing out in July 2009 as part of honouring its employment commitments. Another 2,000 people are to be recruited laterally by the second quarter of 2009-10.