Cognizant offers top executives 6-9 months’ salary for voluntary exit
Cognizant has given the top-rung executives an option to exit by accepting either six (for senior VPs) or nine (for directors) months’ salary as severance pay
New Delhi: IT services firm Cognizant Technology Solutions Corp. is extending a “voluntary separation incentive”, offering up to nine months of salary, to some of its top-level executives.
The US-based firm, which has a large part of its 2.6 lakh-strong workforce in India, has written to top executives in director and senior vice-president roles. The company has given the top-rung executives an option to exit the organisation by accepting either six (for senior VPs) or nine (for directors) months’ salary as severance pay. “This voluntary initiative is being communicated to management-level associates—from director-level to senior vice-president—and eligibility is at the discretion of Cognizant leadership,” a Cognizant spokesperson said.
He declined to divulge details of the incentives that are being offered or the number of employees that would fall under the process. “... We are offering a voluntary separation incentive to some eligible leaders, representing a very small percentage of our total workforce... We believe it provides a fair and positive experience for those choosing to leave,” the spokesperson said.
According to people aware of the development, these executives will have to inform the company of their decision by 12 May, following which the leadership will have the authority to take a decision. Cognizant will, however, continue to hire across all of its practices and is expanding facilities globally, ensuring that it has the “right expertise to help its clients”, the spokesperson said.
The company—which competes with Indian IT players like Tata Consultancy Services Ltd (TCS) and Infosys Ltd—had posted a 4.3% decline in net profit to $1.55 billion in 2016. After stellar revenue growth in the past few years, the pace of growth seems to be slowing down for Cognizant. Its annual revenues stood at $13.49 billion, up by 8.6 per cent over previous year, after slashing its growth forecast thrice during the year.
However, it raised guidance for 2017, estimating revenue to be around $14.5-14.84 billion.