Tech Mahindra layoffs: Hyderabad HC issues notices to co, Telengana govt; seeks reply in 3 weeks

The sacking has been termed unlawful as the staff were in discussion with the management and labour commissioner over the manner of retrenchment

FP Staff July 11, 2017 16:34:51 IST
Tech Mahindra layoffs: Hyderabad HC issues notices to co, Telengana govt; seeks reply in 3 weeks

The Hyderbabd High Court has issued notices to Tech Mahindra and the Telengana government in response to a petition seeking intervention in the sackings of the information technology professionals, according to a report by MoneyControl. The respondents have been asked to give a reply in three weeks' time.

The court admitted the petition by the four former employees, who alleged the company had sacked them unlawfully as they were in discussion with the management and labour commissioner over the manner of retrenchment.

The development comes after a conversation between an HR executive and an employee of Tech Mahindra was leaked in the media, which brought to light the plight of the staff at the country's fifth largest IT company.

In the audio clip, the HR executive was heard telling the staff to put in his papers in 24 hours rudely. After MoneyControl reported about the shocking way in which the staff was given the sack order, Anand Mahindra and CP Gurnani had tendered a public apology on Twitter.

In fact, the layoffs in the IT sector have been in the news for the last few months and the Forum for IT employees (FITE), a union of the IT staff which is awaiting registration, has taken up these with the authorities.

In May, there were reports that Tech Mahindra was planning to hand out pink slips to hundreds of employees as it looks to "weed out bottom performers".

Tech Mahindra layoffs Hyderabad HC issues notices to co Telengana govt seeks reply in 3 weeks

Representational image. Reuters

As of end December 2016, the company had over 1.17 lakh employees.

Later FITE had requested the Maharashtra Labour Commissioner to order Tech Mahindra to stop 'illegal removals' of the staff and establish conciliation between the management and staff.

Though Tech Mahindra has been insisting that the retrenchment was performance driven FITE has said the restructuring activity has not been done on the performance basis. According to the forum, thousands of employees who are being terminated are actually good performers. as they were rated good in appraisals earlier and also were appreciated and awarded for their work from both the client and the company.

Tech Mahindra's larger rivals, Wipro, Infosys and Cognizant had been in the news for similar performance reviews and it had been estimated that thousands of employees in the sector could have been shown the door over the recent few weeks.

The development comes at a time when Indian IT firms are facing challenges in the business environment and stricter work permit regime in countries like the US, Singapore, Australia and New Zealand.

While the companies have termed these layoffs as part of normal business decisions, many believe these are directed more towards controlling costs.

The US-based Cognizant had rolled out a voluntary separation programme for directors, associate VPs and senior VPs, offering them 6-9 months of salary.

Wipro, too, is learnt to have asked about 600 employees to leave as part of its annual "performance appraisal" even as speculations were that the number could go as high as 2,000.

With the US hardening its stance on outsourcing, IT firms are under pressure to hire locals instead of taking Indian employees on work visas to client sites. This also impacts their margins.

With PTI inputs

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