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Business News/ Industry / Infotech/  Are trade unions gaining a foothold in IT sector?

New Delhi: For the last eight years, trade unions have been trying to get a foothold in the $118 billion Indian information technology (IT) sector that employs over three million people. So far, they have met with little success.

But now the move appears to be gathering momentum, with unions rallying around a few hundred employees of India’s largest IT services firm, Tata Consultancy Services Ltd (TCS) who have been asked to quit due to “non-performance".

While media reports and posts by some employees’ unions on social media sites such as Facebook and Twitter peg the number of those asked to leave at between 25,000 and 30,000 across centres in the country, TCS contested the number but did not provide specifics.

A TCS spokesperson said in a written reply on Monday that “as a performance-driven company, workforce optimization is a continuous process which happens throughout the year taking into account employee performance, business needs, and people aspirations. This leads to some amount of involuntary attrition in the company. This is nothing out of the ordinary or a special situation for us to comment about..."

Meanwhile, unions including the Centre of Indian Trade Unions (Citu), which is affiliated to the Communist Party of India (Marxist), the Congress party-affiliated Indian National Trade Union Congress (Intuc) and UNITES India, affiliated to the global union United Network International, protested the company’s move.

“If an organization suddenly starts firing people because it is not profitable, that is an emotional outburst by the organization," said Karthik Shekhar, general secretary, UNITES India, and a former employee of International Business Machines Corp. (IBM).

“TCS has been doing it since last eight-nine years, but the numbers were small—between five and 50. Now it has stepped on the gas and thus the outburst," alleged Shekhar, who claims to have about 25,000 members in his union.

According to Prasanta Nandi Chowdhury, national secretary of Citu, “All the major IT firms do not have open policies on things like recruitment, wage hikes or firing people. All we have come to know about is through individuals. Most of these employees have insecurity about their jobs. We are putting our efforts together so far, so as to bring them together to form a union which can fight and negotiate on an employee’s behalf."

He added that “a little more than 10,000 people are connected with us".

Snabak Vinod, representative of Forum for IT Employees (Fite) and team lead at Caterpillar Inc., a global manufacturer of construction, mining and diesel equipment, said he met Naresh Kumar, deputy labour commissioner for the Rangareddy region in Hyderabad, to talk about TCS Hyderabad laying off some employees from the centre.

Kumar, he added, has asked the affected TCS employees who are members of Fite to put their grievances down in writing.

Fite members, according to Kumar, are also trying to mobilize laid-off TCS employees in Chennai, Bengaluru, Pune, Mumbai and Delhi to submit individual petitions challenging their layoffs with the labour commissioners of the respective states.

TCS on its part maintained that it continues to be a leading recruiter of IT talent across the world, not only in India. “In this fiscal year, we have a total hiring target of 55,000 professionals and we are on track to meet it," the spokesperson added.

“We would like to reiterate as had been done by Mr Ajoy Mukherjee, EVP (executive vice-president) and head of global HR (human resources), in a press conference in Bangalore on 12th of December that our total global annual involuntary attrition is between 1-2% across the organization which includes employees who retire, business associates hired for specific projects, etc.," the spokesperson said in the email response.

According to software lobby Nasscom, IT firms are justified in letting go of non-performers.

“We believe the industry is going to continue to be a net hirer. The fact is the layoffs happen on a yearly basis. The industry is focusing on skills," said Nasscom’s vice-president Sangeeta Gupta, adding that “the industry offers employees all the perks and learning environment. The employees have the right to choose and this is why the attrition rate is so high."

She pointed out that the attempt to form a union in the IT industry “have been going on for a long time, but it won’t impact the industry at large".

Industry experts believe that though moves to get IT employees to form or join a workers’ union may not change the way the industry works, they may lead to companies taking a relook at their current policies.

“The companies need to look at the performance and counsel consistent under-performers. Those who cannot perform need to find some other way. This is not something unjustified. Though the ongoing attempts to unionization are not going to cause any major shift in a way the performance is managed in the IT and related industries, the companies may have a relook at the whole process," said P. Thiruvengadam, senior director, Deloitte Touche Tohmatsu India Pvt. Ltd.

He added that while “the employee unions may issue a public statements on hiring and laying off, they do not have any grounds to interfere in how the IT firms work.

“The kind of employee union that we see in the manufacturing industry is not going to happen in the IT industry since the engineers or software developers working in the IT firms are not members of any union."

Chowdhury of Citu acknowledged that while software developers and engineers are reluctant to join or form such unions, those “who work in call centres, BPOs (business processing outsourcing units) or KPOs (knowledge processing outsourcing units) are willing to join us but are scared of getting fired".

Beryl Menezes in Mumbai contributed to this story.

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Updated: 06 Jan 2015, 12:35 AM IST
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