7 top IT firms to lay off 56,000 this year, new tech and Trump’s policies blamed

IT companies

Information technology (IT) companies in India are in the midst of the industry’s largest retrenchment drive with seven of the biggest IT firms planning to ask at least 56,000 engineers to leave this year.

The number is at least twice the employees laid off by the companies last year, reflecting their under-preparedness in adapting to newer technologies and dealing with fallout from US President Donald Trump’s protectionist policies.

The companies include both Indian and multinational firms with a large footprint in India.

The seven companies — Infosys Ltd, Wipro Ltd, Tech Mahindra Ltd, HCL Technologies Ltd, US-based Cognizant Technology Solutions Corp. and DXC Technology Co, and France-based Capgeimini SA — and which together employ 1.24 million people, plan to let go of 4.5% of their workforce in 2017.

Most of them will end the year with fewer employees than they started with, despite continuing to hire young engineers, according to the HR heads at two of the seven companies.

 

The numbers were collated by Mint after extensive interviews with 22 current and former employees across these seven companies.

Preparing the ground for layoffs, each of these seven companies has already put a higher number of employees on notice by awarding them the lowest ratings. Cognizant has placed more than 15,000 employees in the lowest category (bucket IV), and Infosys placed more than 3,000 senior managers in the category of employees needing improvement.

DXC Technology is in the midst of a three-year plan to reduce the number of offices in the country from 50 to 26. The company plans to ask 5.7% or 10,000 of its 175,000 employees in India to leave this year.

All seven companies are still in denial mode and attribute the planned exits to a “marginal” increase in the number of poor performers on account of a “more rigorous” performance evaluation process.

“Cognizant has not conducted any layoffs,” a spokesman said, adding that the performance-based reviews this year are consistent with past ones.

“Our performance management process provides for a bi-annual assessment of performance,” a spokeswoman for Infosys said, declining to share the number of employees asked to leave in the current quarter. “We do this every year and the numbers could vary every performance cycle”

“Performance appraisal may also lead to the separation of some employees from the company and these numbers vary from year to year,” a Wipro spokesperson said.
[Source”timesofindia”]