Tech Mahindra sacking: Layoffs can be handled better; HR experts weigh in with ideas

Resign or else face the sack. Human Resource (HR) professionals in the information technology services companies seem to be using cruel means to lay off employees, as is evident from the leaked telephonic conversation between a IT professional in Tech Mahindra and an HR executive.

For the uninitiated, the IT sector in India is witnessing a churn due to various reasons, including a slowdown in key markets and protectionist policies in major economies. Estimates say about 2 lakh jobs will be lost in the sector by March 2018.

The truth is that for the employees and the companies, there is no escaping the fact they will have to deal with a lot of heartburn. But then, the companies have to deal with the difficult phase in a matured manner, which definitely is not the Tech Mahindra way.

Firstpost spoke to HR experts on the issue. Given below are their ideas to deal with the situation better:

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Breaking the news

There surely are better ways to communicate to an employee that she is no longer needed in the organization – not because of performance issues, but because the company hired more than it should have or the demand-supply of projects for the company has whittled down making it unreasonable to keep many employees in its fold. It should never sound like a threat, similar to what Tech Mahindra HR issued to its staff, for instance.

Rules apply to both employer and employee

When a candidate is hired by any organisation, the former signs an agreement which stipulates the terms and conditions of employment. It states the notice period to be served in case the employee wishes to leave or pay up if she does not want to serve the notice period. If the company chooses to sack the employee, a similar notice period applies.

“There are rules in the country that an employee and an employer can approach if either of them dishonor the agreement,” says Rituparna Chakraborty, president, Indian Staffing Federation, and also vice-president and co-founder, Teamlease Services.

There is no way you can make the news that an employee has to leave the company’s payroll sweet but it can certainly be made less bitter by being compassionate. There is no way the company can have the bulk of employees it can’t sustain as it will impact its bottom line adversely. “But the company should be very careful about its communication. Be sensitive and compassionate. If you can, give the employee a notice period or cash to support herself when she is without a job,” suggests Chakraborty.

HR should be supported by counsellors

The role of human resources is bereft of emotion and is characterised by staccato and practicality. “An HR person is only performing a duty as instructed by the management,” says ShivaKumar N, business head, RPO, Teamlease Partners – a human resource service company.

Anshul Prakash, partner, Khaitan & Co, where he heads employment and labour practices, says that whether one or ten or 10,000 employees are to be sacked, the approach has to be a subtle mix of empathy and sensitivity. “An employee is attached to the firm until his last day and may become arrogant and angry when she is told that her services are no longer needed,” he says.

When a company takes a threatening posture in such a situation, it does not bode well for the firm. Good will counts for the company image, too.

Have a one-on-one with employee

The idea is to have a more structured approach instead of asking people to leave the organisation overnight, says Prakash.

One must concentrate on the employee’s paper trail while making the way out for exit. Have a one-on-one discussion with the employee, says Prakash. He suggests the company should come clean to the employee about its reasons, and that from an employment perspective should convey that it has no option other than to ask the employee to leave.

Give an option to the employee after stating the reasons for your (employer’s) move to ask the former to leave. “Adopt an approach of an option instead of issuing a threat. Have a phased-out operation instead of giving a jolt to the employee. Build up the scenario with the employee about the company’s prospects,” says Prakash.

The employee has been in the organisation’s employ after having cleared the latter’s stringent rules of employment. When the employee is sacked without any reference to performance matrix – as is the case with many IT majors in the country for some time now, it is important the company tells the employee that it cannot afford to keep her in its payroll as it cannot offer incentives, promotions and any such hikes.

“The employee will feel terrible then too,  but the blow of severance is softer,” says Prakash.

Outplacement program is an option, too

A few multi-national companies have an outplacement programme. What it does is offer to support the employee through a skill upgradation program, for instance, or a study program that will equip the employee to upgrade his résumé.

An outplacement company can organise employees to reach their performance threshold. “The outplacement firm can help a sacked employee understand his/her potential, capabilities, achievements and work towards enhancing them. The employee’s former employer can pitch for counselling and professional agencies to help the employees they are sacking,” says Shivakumar.

Of course, there is a cost involved for the company. “But that is a human way of dealing with such a situation and no company should avoid this approach because of cost measures,” he points out.

So though the company has to fire 10 or 15 employees daily as an exercise to be undertaken to cut costs, the HR cannot be expected to be empathetic. But if freelance counsellors or psychiatrists were hired for a short period to break the news to the employees with politeness and empathy, it would make the severance a little less painful, say analysts.


Published Date: Jul 10, 2017 05:15 pm | Updated Date: Jul 10, 2017 05:54 pm

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