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IT mass layoffs: TN govt holds talks with firms, employee unions excluded from meeting

The Union of IT & ITES Employees (UNITE) and All India Forum for IT/ITeS Employees (AIFTE) whose complaints paved the way for the initiative were not allowed into the meeting.

Written by Janardhan Koushik | Chennai |
Updated: November 20, 2019 6:45:38 pm
IT, IT sector, IT layoffs, Tamil Nadu Labour Commisioner, Labour Union, Mass retrenchments, Indian Express News, Chennai News The management is re-skilling employees for advanced programs, the mid-level to senior-level associates who aren’t able to grasp these new IT skills in a short time are asked to leave. (Representational Image)

The Tamil Nadu Labour Commissioner has held a meeting with 20 companies over complains of mass layoffs in the IT sector. The meeting, chaired by Labour Commissioner Dr R Nandagopal, IAS, was attended by representatives of tech giants Cognizant Technology Solutions, Infosys, Tata Consultancy Services, Cape Gemini, HCL Technologies, IBM, Wipro, etc besides the National Association of Software and Services Companies (NASSCOM).

However, the Union of IT & ITES Employees (UNITE) and All India Forum for IT/ITeS Employees (AIFTE), whose complaints paved the way for the initiative, were not allowed into the meeting. According to sources, the Commissioner had asked the IT-firms to furnish employment details of the current year and the previous year to gauge claims on mass retrenchment put forth by the unions.

Speaking to indianexpress.com, Bharanidharan, the President of UNITE, who claimed to have submitted the memorandum to the TN Labour Commissioner on November 5 against layoffs, said they weren’t even allowed to be an observer in the meeting.

“We requested the Labour Commissioner to allow us into the meeting, but we were turned down. They said as per the Chief Minister’s order, the meeting is only between the management and the Labour Commissioner. We were not even allowed to be an observer in the meeting, they informed us that this is not a tri-party meeting and we will be called for a discussion with the Commissioner later,” he said.

Bharanidharan claimed that NASSCOM doesn’t represent the employees and it was a welfare organisation for employers.

“The lack of awareness amongst the employees about labour laws is the reason why none raised a flag when companies tried to sack a bunch of them in the past. After we started this union (in mid-2017), there is some awareness amongst the employees. We want a tri-party meeting where we can express our concerns and solve the issues the industry is currently facing,” Bharanidharan further said.

Another reason he claimed behind the mass layoffs was the restrictive immigration policy by the Donald Trump administration that led to the increase in denial of H-1B visas in the recent past.

“Many applications are getting rejected so the companies are forced to recruit local people whose wages are multiple times bigger than an Indian worker’s salary. So, in order to compensate the budget, the company is cutting down on the number of employees in India to maximise profits,” he said.

As per a media report, IT major Cognizant plans to remove about 10,000-12,000 mid-to-senior level associates worldwide, which would include a net reduction of about 5,000 to 7,000 roles (about 2 per cent of its total headcount).

Author and economist Anand Srinivasan feels there is a threat of IT industry leaving the country if they are pressurized by the unions and the labour commission to retain under-skilled employees.

“There is no god-given right that the company should employ a person for life. See, there is a pyramid, the base is very big but as it goes upper and above it gets narrower. So for every 1,000 employees who join the company, only five or ten will reach the top position. IT professionals who are in the mid-level in a company get paid about Rs 1 or 1.20 lakh per month. These people try to survive in the Industry without developing any skillset and that’s the reason why companies are asking them to leave as they don’t add any value,” Srinivasan said.

“Also, the unemployment rate in India has increased to an all-time high, so it’s easier for companies to replace the person earning 1.25 lakhs per month with two rows of 25,000-30,000 rupees. If any fresher can be trained for two-three years, he can do the task what the 10-15 years experienced person had been doing. There is a threat of recession in the USA and Europe has been in trouble for a long time. To survive in the industry, you have to be self-motivated. Get updated with advanced technologies – there are plenty of courses available online, put time into developing your skillset,” he said.

An employee working with a popular IT-firm in Chennai said mid-level to senior-level associates were being laid off since companies were trying to transform their business from core sectors to advanced technologies like AI/ML, Cloud, Internet of things (Iot), big data and analytics.

“The recruitment of freshers and lay-offs are two different things. The management is re-skilling employees for advanced programs. The mid-level to senior-level associates who aren’t able to grasp these new IT skills in a short time are asked to leave. On the other hand, freshers are mainly trained in these projects. The company can pay less salary to these newcomers and their purpose also gets resolved, so it’s a win-win scenario for the management,” he said.

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