Bengaluru: Intel Corp.’s Indian arm is laying off some employees and offering some others a voluntary separation package after the chipmaker said last month it will cut 11% of its global workforce, according to two persons directly familiar with the development.
Some of those who decline the offer and opt to stay on may be reassigned to other roles at Intel India Pvt. Ltd or moved to other centres, the two said on condition of anonymity.
Apart from Bengaluru, Intel has two facilities in Pune and offices in Kolkata, Mumbai, Secunderabad, Noida, Chandigarh, Ahmedabad and Chennai, according to information available on its website.
Intel India has close to 7,500 employees. The voluntary separation package has been offered only to a select few employees; many others are being let go.
Those who take up the offer will be paid up to four months’ salary (depending on the tenure) plus one month’s salary for every year they have spent at the company. Other benefits include leave encashment and gratuity, one of the two persons cited above said.
The company has given employees time till the first week of June to accept or reject the offer. Those who accept the offer will be relieved by June-end, the first person said.
Intel has already shut operations in Pune, a decision that will affect 180 employees, the second person said.
When contacted, Vasundhara Mudgil, head of communications at Intel South Asia, did not respond to a specific question on the number of employees in India who would be affected by the planned workforce reduction.
There was also no response to questions on the severance package and the Intel sites in India that would be affected. Intel did not comment on whether the layoffs would affect senior-, mid- or junior-level employees.
Intel Corp. chief executive officer Brian Krzanich said on 19 April that the company planned to cut 12,000 jobs amid declining sales in the personal computer market.
“We are not providing site-specific information at this time, and we are still evaluating our plans. Overall, however, we expect that these actions will result in a reduction of up to 12,000 positions globally by mid-2017 through site consolidations, a combination of voluntary and involuntary departures, re-evaluation of projects, and an increased focus on efficiency in a variety of programs,” an Intel spokesperson said in an e-mail response.
The severance package offered by Intel India is “generous,” said Kris Lakshmikanth, founder, chief executive officer and chairman of Headhunters Pvt. Ltd, an executive search firm.
Companies like International Business Machines Corp., Texas Instruments Inc., Motorola Solutions Inc. and Nokia Oyj are among companies that have downsized their workforce in India over the last few years for reasons including corporate restructuring and a slowdown in their markets.
According to Lakshmikant, companies use different mechanisms to reduce headcount and the offers given to employees may also be different.
“There is no industry standard on this (severance package). The offers are different for people in different levels,” said Sandeep Chaudhary, chief executive, Aon Plc., a human resources consulting firm.
According to Chaudhary, when a company looks to reduce its workforce to cut costs, it would typically seek to let go of mid-level and senior employees. Linking the severance payout to length of service would make it attractive for such employees to accept voluntary separation offers, he said.