Techies raise concern over variable pay by IT firms in Hyderabad

The yet to be launched trade union by the Forum of IT professionals (ForIT) has decided to take up the issue of variable pay mechanism employed by MNCs.
Techies raise concern over variable pay by IT firms in Hyderabad

HYDERABAD: A year after unprecedented retrenchments rocked the city, the yet to be launched trade union by the Forum of IT professionals (ForIT) has decided to take up the issue of variable pay mechanism employed by MNCs.  

Though layoffs have been a primary concern for city-based techies, many have raised their concern regarding the variable pay offered by IT firms. While companies inform a new recruit about the concept of variable pay, which is paid to an employee based on either individual performance, company performance or even both, many observe that the firms do not pay the promised amount making it difficult for techies to make personal financial decisions.  

K Madhan, a software engineer who works with a homegrown tech giant in the city, gets an annual package of `6 lakh. He should ideally get Rs 50,000 per month, however, he takes home Rs 37,000 per month. Reason: variable pay.   “We pay tax on the entire salary but when it comes to payment of variable pay, it is given only to the tune of 80-90 per cent. The fact that variable amount is not paid on time and the interest which accumulates on such amount stays with the company is unfair,” he said. The IT firm, in which Madhan currently works, gives variable pay on a quarterly basis. Express had earlier reported that the forum of techies have announced the launch of the trade union on May 26.  

Reduced pay hikes

Meanwhile, a lot of tech professionals are also plagued with a paltry per cent of pay hikes in the present financial year. Attributing such trend to the changing outlook of the technological changes, several MNCs have kept their hikes low. The recent outcry of employees of Capgemini Technology Services India Limited getting a pay hike of 0-0.5 per cent has brought to light how tech professionals are made to settle with no hikes amid growing inflation.

“Inflation is increasing every year but employees get pay hike less than 5 per cent. The whole purpose of a hike is cancelled because at the end there is no increase in real wage and the employee has to make purchases and financial decisions with the same salary, which is difficult. That has to change and we will work towards it through our trade union,” said Chandrahas.     

Likewise, a recent report by KPMG on India’s Annual Compensation Trends 2018-2019 highlighted that the variable pay projection among several sectors including IT and ITES companies has increased from 15.3 per cent to 15.7 per cent for the present financial year. This throws the techies in a much more precarious condition as several companies also give variable pay bi-annually and annually. 

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