WPP, the global advertising company, is to cut 7,200 jobs this year as the recession forces companies to slash their advertising costs, reports The Observer.
About half of this number has already been lost, with the rest expected to go by the end of 2009, said the newspaper citing sources close to the company. WPP said last month that it would balance a likely fall in sales with headcount, which accounts for most of its costs.
Tuesday, May 5, 2009
Monday, May 4, 2009
Cost cutting, Layoffs in India
HR heads look to control costs without layoffs
Source: TheEconomicTimes
Their largest clients may be Americans, but some of India’s leading IT companies aren’t taking a leaf out of American firms when it comes to managing employees. Faced with a business slowdown, Kalpana Jaishankar, HR head at Mumbai-based Mastek, had to do something fast. Every day, bench numbers were swelling but layoffs, what some of her US clients opted for, were not an option the management wanted to consider.
Ms Jaishankar’s dilemma is shared by many HR managers, whose focus has shifted from retaining employees to how not to lay them off and yet control costs. Wipro has implemented two programmes: one, where employees can opt to work for 10 days in a month and get 50% of their salary and two, where employees can take a 12-18 month sabbatical and get 25% of their salary. “We considered a number of options including tweaking the variable pay and salary cuts, but finally the leadership team came to the conclusion that this was the best option with the least amount of pain for the individual,” said Pratik Kumar, executive vice-president, HR, Wipro.
“It was not a Eureka moment... a lot of work went into designing and conceptualising the programme,” said Mr Kumar, a hard-nosed Wipro veteran of 18 years. The business imperatives were compelling and employee costs had to be cut, with these programmes the company met the dual objective of retaining employees and cutting down costs.
Mastek, the first among the IT firms to come up with the concept of a virtual bench, arrived at the decision after a lot of brainstorming and planned the execution in great detail because of the sensitivity around it. Employees on the virtual bench would receive only a percentage of the salary and receive training on various technologies during that period. The identified employees could opt to be on the virtual bench or receive a severance pay and leave the company. An overwhelming 85% opted to stay.
“None of the impacted employees were embarrassed. It wasn’t that they were poor performers, this was a business issue and we wanted to make that clear. The communication was made simultaneously to all the 425-affected employees through a presentation, which also mentioned how they continued to be valuable resources. The presentation also detailed what kind of training they would receive. All the action was in writing - there was no ambiguity,” said Ms Jaishankar.
The presentation was accompanied by a letter containing the legal aspects and FAQs (frequently asked questions). The FAQ also mentioned mentors they could contact, and doctors and counsellors were close at hand in the office to handle emergencies. For Mastek, this was probably the most drastic measure, it had to take in its 27-year history.
On the day it was announced, the affected-employees had permission to leave early and access to systems was also not taken away immediately. In addition, for outstation candidates, the company undertook to foot the accommodation bill during the period.
Given that most of these companies are not making losses, was such a step needed at all? “We debated this but decided it was necessary to avoid any drastic steps in the future - like reducing the number of employees. The future is uncertain and there is a possibility the situation may not improve even in third or fourth quarter,” said Deependra Chumble, chief people officer, Hexaware Technologies. Hexaware has implemented a similar virtual bench programme for 250 of its employees as well as salary cuts for all senior and mid-level employees.
An industry observer summed up the approach of the IT firms thus, “HR managers are still grappling with how to deal with these challenges. This may not be the ideal situation, but it is a new and humane approach for tackling the slowdown.”
Their largest clients may be Americans, but some of India’s leading IT companies aren’t taking a leaf out of American firms when it comes to managing employees. Faced with a business slowdown, Kalpana Jaishankar, HR head at Mumbai-based Mastek, had to do something fast. Every day, bench numbers were swelling but layoffs, what some of her US clients opted for, were not an option the management wanted to consider.
Ms Jaishankar’s dilemma is shared by many HR managers, whose focus has shifted from retaining employees to how not to lay them off and yet control costs. Wipro has implemented two programmes: one, where employees can opt to work for 10 days in a month and get 50% of their salary and two, where employees can take a 12-18 month sabbatical and get 25% of their salary. “We considered a number of options including tweaking the variable pay and salary cuts, but finally the leadership team came to the conclusion that this was the best option with the least amount of pain for the individual,” said Pratik Kumar, executive vice-president, HR, Wipro.
“It was not a Eureka moment... a lot of work went into designing and conceptualising the programme,” said Mr Kumar, a hard-nosed Wipro veteran of 18 years. The business imperatives were compelling and employee costs had to be cut, with these programmes the company met the dual objective of retaining employees and cutting down costs.
Mastek, the first among the IT firms to come up with the concept of a virtual bench, arrived at the decision after a lot of brainstorming and planned the execution in great detail because of the sensitivity around it. Employees on the virtual bench would receive only a percentage of the salary and receive training on various technologies during that period. The identified employees could opt to be on the virtual bench or receive a severance pay and leave the company. An overwhelming 85% opted to stay.
“None of the impacted employees were embarrassed. It wasn’t that they were poor performers, this was a business issue and we wanted to make that clear. The communication was made simultaneously to all the 425-affected employees through a presentation, which also mentioned how they continued to be valuable resources. The presentation also detailed what kind of training they would receive. All the action was in writing - there was no ambiguity,” said Ms Jaishankar.
The presentation was accompanied by a letter containing the legal aspects and FAQs (frequently asked questions). The FAQ also mentioned mentors they could contact, and doctors and counsellors were close at hand in the office to handle emergencies. For Mastek, this was probably the most drastic measure, it had to take in its 27-year history.
On the day it was announced, the affected-employees had permission to leave early and access to systems was also not taken away immediately. In addition, for outstation candidates, the company undertook to foot the accommodation bill during the period.
Given that most of these companies are not making losses, was such a step needed at all? “We debated this but decided it was necessary to avoid any drastic steps in the future - like reducing the number of employees. The future is uncertain and there is a possibility the situation may not improve even in third or fourth quarter,” said Deependra Chumble, chief people officer, Hexaware Technologies. Hexaware has implemented a similar virtual bench programme for 250 of its employees as well as salary cuts for all senior and mid-level employees.
An industry observer summed up the approach of the IT firms thus, “HR managers are still grappling with how to deal with these challenges. This may not be the ideal situation, but it is a new and humane approach for tackling the slowdown.”
Layoffs in USA
NASA announces 900 job cuts ahead of shuttle retirement
NASA has this week announced plans to significantly scale back its employee numbers ahead of the official retirement of its stalwart fleet of space shuttle vehicles after almost 30 years of service.
According to NASA officials, a total of 900 jobs will be cut over the next five months, with an initial 160 notifications in relation to external contractors responsible for the manufacturing of the shuttle’s fuel tanks and its solid rocket boosters expected to be dispatched on Friday, May 01.
Described by the U.S. space administration as “the first significant loss of manufacturing capability,” for the shuttle program, further job cuts will come into effect throughout the summer as the remaining trio of space shuttles work to complete their final eight scheduled missions.
The next shuttle launch, expected on May 11 from the Kennedy Space Center in Florida, will see Atlantis and its crew blasted towards the aging Hubble Space Telescope for an 11-day maintenance and repair mission.
Once officially decommissioned as a space-worthy fleet, the shuttles will be replaced by new Orion space capsules and Ares rockets, which will carry astronauts to and from the International Space Station (ISS) and also on a planned manned mission to the moon.
However, the Orion and Ares projects are not expected to be ready until around 2015. In the meantime, NASA’s access to the ISS will be reliant on passage via Russian Soyuz missions.
According to NASA officials, a total of 900 jobs will be cut over the next five months, with an initial 160 notifications in relation to external contractors responsible for the manufacturing of the shuttle’s fuel tanks and its solid rocket boosters expected to be dispatched on Friday, May 01.
Described by the U.S. space administration as “the first significant loss of manufacturing capability,” for the shuttle program, further job cuts will come into effect throughout the summer as the remaining trio of space shuttles work to complete their final eight scheduled missions.
The next shuttle launch, expected on May 11 from the Kennedy Space Center in Florida, will see Atlantis and its crew blasted towards the aging Hubble Space Telescope for an 11-day maintenance and repair mission.
Once officially decommissioned as a space-worthy fleet, the shuttles will be replaced by new Orion space capsules and Ares rockets, which will carry astronauts to and from the International Space Station (ISS) and also on a planned manned mission to the moon.
However, the Orion and Ares projects are not expected to be ready until around 2015. In the meantime, NASA’s access to the ISS will be reliant on passage via Russian Soyuz missions.
Cost cutting, Layoffs in India
Now, virtual bench to avoid layoffs
Source: indiatimes.com
Their largest clients may be Americans, but some of India’s leading IT companies aren’t taking a leaf out of American firms when it comes to managing employees. Faced with a business slowdown, Kalpana Jaishankar, HR head at Mumbai-based Mastek, had to do something fast.
Every day, bench numbers were swelling but layoffs, what some of her US clients opted for, were not an option the management wanted to consider.
Ms Jaishankar’s dilemma is shared by many HR managers, whose focus has shifted from retaining employees to how not to lay them off and yet control costs. Wipro has implemented two programmes: one, where employees can opt to work for 10 days in a month and get 50% of their salary and two, where employees can take a 12-18 month sabbatical and get 25% of their salary. “We considered a number of options including tweaking the variable pay and salary cuts, but finally the leadership team came to the conclusion that this was the best option with the least amount of pain for the individual,” said Pratik Kumar, executive vice-president, HR, Wipro.
“It was not a Eureka moment... a lot of work went into designing and conceptualising the programme,” said Kumar, a hard-nosed Wipro veteran of 18 years. The business imperatives were compelling and employee costs had to be cut, with these programmes the company met the dual objective of retaining employees and cutting down costs.
Mastek, the first among the IT firms to come up with the concept of a virtual bench, arrived at the decision after a lot of brainstorming and planned the execution in great detail because of the sensitivity around it. Employees on the virtual bench would receive only a percentage of the salary and receive training on various technologies during that period. The identified employees could opt to be on the virtual bench or receive a severance pay and leave the company. An overwhelming 85% opted to stay.
“None of the impacted employees were embarrassed. It wasn’t that they were poor performers, this was a business issue and we wanted to make that clear. The communication was made simultaneously to all the 425-affected employees through a presentation, which also mentioned how they continued to be valuable resources. The presentation also detailed what kind of training they would receive. All the action was in writing - there was no ambiguity,” said Ms Jaishankar.
The presentation was accompanied by a letter containing the legal aspects and FAQs (frequently asked questions). The FAQ also mentioned mentors they could contact, and doctors and counsellors were close at hand in the office to handle emergencies. For Mastek, this was probably the most drastic measure, it had to take in its 27-year history.
On the day it was announced, the affected-employees had permission to leave early and access to systems was also not taken away immediately. In addition, for outstation candidates, the company undertook to foot the accommodation bill during the period.
Given that most of these companies are not making losses, was such a step needed at all? “We debated this but decided it was necessary to avoid any drastic steps in the future - like reducing the number of employees. The future is uncertain and there is a possibility the situation may not improve even in third or fourth quarter,” said Deependra Chumble, chief people officer, Hexaware Technologies. Hexaware has implemented a similar virtual bench programme for 250 of its employees as well as salary cuts for all senior and mid-level employees.
An industry observer summed up the approach of the IT firms thus, “HR managers are still grappling with how to deal with these challenges. This may not be the ideal situation, but it is a new and humane approach for tackling the slowdown.”
Their largest clients may be Americans, but some of India’s leading IT companies aren’t taking a leaf out of American firms when it comes to managing employees. Faced with a business slowdown, Kalpana Jaishankar, HR head at Mumbai-based Mastek, had to do something fast.
Every day, bench numbers were swelling but layoffs, what some of her US clients opted for, were not an option the management wanted to consider.
Ms Jaishankar’s dilemma is shared by many HR managers, whose focus has shifted from retaining employees to how not to lay them off and yet control costs. Wipro has implemented two programmes: one, where employees can opt to work for 10 days in a month and get 50% of their salary and two, where employees can take a 12-18 month sabbatical and get 25% of their salary. “We considered a number of options including tweaking the variable pay and salary cuts, but finally the leadership team came to the conclusion that this was the best option with the least amount of pain for the individual,” said Pratik Kumar, executive vice-president, HR, Wipro.
“It was not a Eureka moment... a lot of work went into designing and conceptualising the programme,” said Kumar, a hard-nosed Wipro veteran of 18 years. The business imperatives were compelling and employee costs had to be cut, with these programmes the company met the dual objective of retaining employees and cutting down costs.
Mastek, the first among the IT firms to come up with the concept of a virtual bench, arrived at the decision after a lot of brainstorming and planned the execution in great detail because of the sensitivity around it. Employees on the virtual bench would receive only a percentage of the salary and receive training on various technologies during that period. The identified employees could opt to be on the virtual bench or receive a severance pay and leave the company. An overwhelming 85% opted to stay.
“None of the impacted employees were embarrassed. It wasn’t that they were poor performers, this was a business issue and we wanted to make that clear. The communication was made simultaneously to all the 425-affected employees through a presentation, which also mentioned how they continued to be valuable resources. The presentation also detailed what kind of training they would receive. All the action was in writing - there was no ambiguity,” said Ms Jaishankar.
The presentation was accompanied by a letter containing the legal aspects and FAQs (frequently asked questions). The FAQ also mentioned mentors they could contact, and doctors and counsellors were close at hand in the office to handle emergencies. For Mastek, this was probably the most drastic measure, it had to take in its 27-year history.
On the day it was announced, the affected-employees had permission to leave early and access to systems was also not taken away immediately. In addition, for outstation candidates, the company undertook to foot the accommodation bill during the period.
Given that most of these companies are not making losses, was such a step needed at all? “We debated this but decided it was necessary to avoid any drastic steps in the future - like reducing the number of employees. The future is uncertain and there is a possibility the situation may not improve even in third or fourth quarter,” said Deependra Chumble, chief people officer, Hexaware Technologies. Hexaware has implemented a similar virtual bench programme for 250 of its employees as well as salary cuts for all senior and mid-level employees.
An industry observer summed up the approach of the IT firms thus, “HR managers are still grappling with how to deal with these challenges. This may not be the ideal situation, but it is a new and humane approach for tackling the slowdown.”
Airways, Layoffs in India
Jet Airways lays off 110 employees
India's leading private carrier Jet Airways handed over pink slips to 110 employees on the eve of May Day, the company said Friday. "Jet Airways undertakes additional measures to streamline costs to improve the financial health of the company under the challenging economic environment. The airline has issued notices of termination to identified employees on contract, who have superannuated," a company spokesperson said.
"The termination is in accordance with the law and their (employees') service conditions," he added. Of these employees, 50 were on contract basis, while the remaining 60 were probationary cabin-crew.
"The termination is in accordance with the law and their (employees') service conditions," he added. Of these employees, 50 were on contract basis, while the remaining 60 were probationary cabin-crew.
cognizant, CTS, H1-B, NRIs
H1B Cap : Latest Update
First Count : April 9, 2009 - 42,000 and 20,000
The USCIS issued the first cap count on April 9, 2009. As of that count, approximately 42,000 H1B petitions had been received under the “regular” cap. While the 20,000 advanced degree limit had been reached, USCIS indicated that some more advanced-degree cases would continue to be accepted, to allow for normal rates of denials and withdrawals.
Second Count : April 13, 2009 - 43,000 and 20,000
The next count was issued April 20th, for cases filed through April 13, 2009. As of that date, the USCIS had received 43,000 regular cap cases. Additionally, advanced-degree cases were still being accepted due to the expectation that it is normally necessary to accept some percentage more than 20,000 cases to end up with 20,000 H1B petitions with approvals.
Third Count : April 20, 2009 - 44,000 and 20,000
The count for April 20, 2009 reflected an additional 1,000 regular cap filings in the week following the previous count. The advanced-degree cap filings must have been very light, as the USCIS had still not reached the limit for those cases.
Fourth Count : April 27, 2009 - 45,000 and 20,000
The fourth count was issued April 27, 2009. As of that date, approximately 45,000 regular cap cases had been received by the USCIS. Advanced-degree cases were still being accepted.
Conclusion
Regarding the H1B cap, FY2010 was very different from the couple of years immediately preceding. This is driven primarily by the economy. It appears to be a clear indication that the request for H1B workers is largely self governing, and that, when the job market is depressed, the H1B filing levels drop accordingly. Critics of the H1B program, who claim that the H1B numbers should not be increased, are incorrect in their assessment, as the supply-and-demand cycle seems to be working again with H1B filings greatly reduced due to the decrease in demand, even for highly skilled workers.
The USCIS issued the first cap count on April 9, 2009. As of that count, approximately 42,000 H1B petitions had been received under the “regular” cap. While the 20,000 advanced degree limit had been reached, USCIS indicated that some more advanced-degree cases would continue to be accepted, to allow for normal rates of denials and withdrawals.
Second Count : April 13, 2009 - 43,000 and 20,000
The next count was issued April 20th, for cases filed through April 13, 2009. As of that date, the USCIS had received 43,000 regular cap cases. Additionally, advanced-degree cases were still being accepted due to the expectation that it is normally necessary to accept some percentage more than 20,000 cases to end up with 20,000 H1B petitions with approvals.
Third Count : April 20, 2009 - 44,000 and 20,000
The count for April 20, 2009 reflected an additional 1,000 regular cap filings in the week following the previous count. The advanced-degree cap filings must have been very light, as the USCIS had still not reached the limit for those cases.
Fourth Count : April 27, 2009 - 45,000 and 20,000
The fourth count was issued April 27, 2009. As of that date, approximately 45,000 regular cap cases had been received by the USCIS. Advanced-degree cases were still being accepted.
Conclusion
Regarding the H1B cap, FY2010 was very different from the couple of years immediately preceding. This is driven primarily by the economy. It appears to be a clear indication that the request for H1B workers is largely self governing, and that, when the job market is depressed, the H1B filing levels drop accordingly. Critics of the H1B program, who claim that the H1B numbers should not be increased, are incorrect in their assessment, as the supply-and-demand cycle seems to be working again with H1B filings greatly reduced due to the decrease in demand, even for highly skilled workers.
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