Phaneesh Murthy
Phaneesh Murthy poses during the World Economic Forum (WEF) in Davos, January 26, 2013.Reuters

The Board of Directors of iGate Corp, an information technology outsourcing services provider, has sacked its president and CEO Phaneesh Murthy on sexual harassment charges filed against him by an employee of the company.

The board decided to terminated Phaneesh's employment for failing to inform the company board about his relationship with a subordinate employee, as it is required to do so under the company's HR policy.

"The board's decision was made as a result of an investigation by outside legal counsel, engaged by the board, of the facts and circumstances surrounding a relationship Mr Murthy had with a subordinate employee and a claim of sexual harassment," according to a statement from iGate.

"The board deliberated extensively on this matter," said Sunil Wadhwani, co-founder and co-chairman of the iGate board. "We recognize the significant contributions Mr. Murthy has provided over the past 10 years in helping to establish iGate as a leader in the IT industry. He has worked hard to improve the value of iGate, and we greatly appreciate his efforts. However, as a result of this violation of iGate policy, we asked Mr. Murthy to step down."

This is not the first time that Phaneesh has faced sexual harassment charges. At Infosys Ltd, Phaneesh who was working as the California-based global head of sales (before 2002) was accused of sexual harassment by his personal secretary, Reka Maximovitch. A lawsuit was filed and was settled out of court by the company for $3 million. Phaneesh joined iGate Global Solutions Limited in August 2003, after the company acquired his new firm Quintant.

He served as CEO and president of iGate since 1 April, 2008, and also as the managing director of iGate Global Solutions Ltd and iGate Corporation.

Following Phaneesh termination at iGate, the company has appointed Gerhard Watzinger as interim chief executive. The 52-year-old company veteran has served a number of roles including an executive position at iGate from 1998 to 2003 and CEO of the iGate Solutions business (formerly Mascot Systems).

The company has also created a search committee within the Board of Directors to identify and select an experienced industry veteran, who would take over as the permanent president and CEO.