Indian IT giant Tech Mahindra has been creating quite some buzz of late. After the firm announced in February that it was suspending the appraisal of some of its senior employees, which in turn would delay the salary hikes, the senior executives of the firm have now said that they were willing to take a 10-20 percent pay cut.
The executives' move comes in light of the firm mediocre performance in the last few months. About 20 senior executives have offered to take the pay cut and have written an email, stating the same, to Tech Mahindra CEO CP Gurnani and chief people officer Rakesh Soni, reported the Times of India.
Meanwhile, a source told the daily that the management had earlier hinted that they would appreciate it if the senior executives take pay cuts in a bid to help the company cut costs at a time when it is struggling to better its performance. It is also being said that this would be a temporary plan and the pay would go back to usual once the firm's performance becomes better.
Tech Mahindra has made quite some efforts to cut costs in the last few months. In February it suspended the appraisal of almost 500 senior employees and even sacked a few workers. But it landed in hot water when an employee was fired over the phone, the recording of which went viral.
In the phone call, the HR representative of the firm had asked the employee to resign by 10 am the next day and said that the layoff was a part of the company's restructuring plan. Even though the employee requested the representative to give him some more time, the HR told him that he needed to leave with immediate effect and cited the condition in the employment contract, which says that the employer can ask an employee to leave with immediate effect.
"Cost optimization is happening at the company and your name is part of that list. If you can put in papers we will be treating it as a normal exit with June 15 as last working day. If not, we will be sending you a termination letter and don't expect anything from the company including an experience letter or basic salary," the HR is heard saying.
Post this fiasco, the Hyderabad High Court had admitted a writ petition filed by four laid-off employees of the IT firm. The court has also issued a notice to the IT giant asking it to explain the unlawful job cuts.
Meanwhile, it is not just Tech Mahindra that has been hit by the slowdown in the industry. Other IT firms such as Infosys and Cognizant had delayed the hike of their employees. Cognizant was also said to be offering a voluntary retirement scheme to its senior employees. The firm had reportedly given its senior employees an option to accept a six or nine months' severance package, whichever is applicable.
"We are offering a voluntary separation incentive to some eligible leaders, representing a very small percentage of our total workforce. It is related to our overall company strategy to accelerate our shift to digital and to deliver high-quality, sustainable growth," a Cognizant spokesperson had earlier told the Economic Times.
