Lockdown woes: Bloodbath in IT, BPO sectors as pay cuts, job losses become the norm

The lockdown has hit IT/ITES industries hard, with many employees losing jobs and facing pay-cuts; the worst hit are those working in companies that have not even paid for months they worked from home
Representational Image. (Photo | EPS)
Representational Image. (Photo | EPS)

CHENNAI: The lockdown may not have killed the raging virus, but it sure did kill hundreds of jobs. Crossing sectoral barriers, it has hurt employees in manufacturing and services industries. The IT and business process outsourcing (BPO) sectors are witnessing a bloodbath right now, thanks to the pay cuts and job losses.

Industry sources tell us that hundreds of workers are being asked to go on unpaid leaves till July, or, even worse, being fired. The threat is accentuated for those on the bench — who are not handling any projects currently. Daniel* an employee of the Cognizant Technology Solutions for the last eight years, was asked leave on May 22. 

“They gave me two options — either take a severance pay equal to my three-month salary and leave, or wait for one month on the bench for new projects. The catch is that if we do not get any new projects in that one month, I will have to leave without a compensation. They did not give me much time to think it through. I had to make up my mind by May 31.”

Daniel decided to take the money and leave. “When I went to the Thoraipakkam office to handover my equipment, I was told that 700 other employees were asked to resign in similar fashion, all between May 31 and June 2. The actual number could be much higher,” claims Daniel. 

While losing a job at these turbulent times is troublesome enough, a few other companies have even refused to pay up pending salaries. 

Hexaware Technologies has given just a verbal communication to its bench employees, that they won’t be paid for the months of May, June, and July.

Those who continue to be on the bench after July would be terminated.

“We were informed about this over phone in the first week of April. Many of us received the May salary, but some are being asked to quit immediately,” says Ram*, an associate consultant. While many of these actions are a blatant violation of labour laws, the practices continue unabated. 

Safety or job security?       

Arun* a resident of Chennai working for Capgemini in Bengaluru, says his company is forcing him to exhaust his leaves and later go on a loss of pay.

“I stay in a PG accommodation in Bengaluru. When the lockdown started, I moved back to Chennai before the inter-State borders could be closed. My manager has been insisting that I return to Bengaluru, at my own personal risk, to collect my computer for work.”

Arun says till April 17, his company allowed him to work on his personal laptop, with client approval. “The permission was revoked on April 20.

Now, I have not been assigned a laptop or desktop even though I am ready to work. I have been forced to apply leave and once my leaves are exhausted, I will have to go on loss-of-pay.”

Several IT firms in Chennai are resorting to lay-offs, says AJ Vinod of the All India Forum for IT Employees (AIFITE).

“But the numbers are not too big, yet.” Employees from CTS, Hexaware, and other firms have contacted the AIFITE.

“We have written to these individual companies, Tamil Nadu labour commissioner, and the Union government to take appropriate action.”   

Violating government norms

The Central government, as early as on March 29, issued strict orders to all employers to pay wages to workers without any deduction for the period when their establishment was closed down due to the lockdown.

Despite that, and despite the fact that most techies continued to work from home during the lockdown, the issue of non-payment of salaries has arisen. 

The Secretary (Labour & Employment) had written to chief secretaries of all States to advise employers not to terminate employees from their job, or reduce their wages amid the challenging situation of the pandemic. Compared to other sectors, IT industry has largely been unaffected by the lockdown. Some firms have even registered an increase in productivity. 

Shreeranganath Kulkarni, Chief Delivery Officer, Birlasoft, says, “We have been able to meet all milestones and service levels, with 96% of our employees in WfH mode.”

Meanwhile, to help laid-off employees quickly find another job, employment portals are offering special features and assistance.  

Naukri has introduced a new feature in its portal called ‘Step-up’. Pawan Goyal, Chief Business Officer, Naukri.com, told Express that the initiative will highlight and boost profiles of these jobseekers to recruiters, thereby improving the chances of getting shortlisted.

“One of the initiatives under ‘Step-Up’ is the live tracker highlighting companies and industries that are currently hiring along with active jobs to apply to. Close to 5500+ unique companies have posted jobs on the Naukri platform to hire relevant candidates.”

Aditya Narayan Mishra, Director and CEO of CIEL HR, says Chennai is the worst among all other metros in terms of recovery, witnessing a slump of 70 per cent.

“As the lockdown is being relaxed and businesses are resuming, other metros have shown some recovery including Mumbai, which is worst affected by coronavirus. But, Chennai is not showing great progress in terms of recruitment, the reason being its overdependence on auto, manufacturing and IT service sectors. It would take at least another 4-5 months for normalcy to return.” 

(Names of employees have been changed to protect their identity)

Centre’s order

The Central government, as early as on March 29, issued strict orders to all employers to pay wages to workers without any deduction for the period when their establishment was closed down due to the lockdown.

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