lay off

While you were reading the news that Mahindra Satyam has secured contracts worth $79 million only for the second quarter in North Africa and Middle East regions, employees at Satyam were reading quite a different news in their mailboxes. Read the full story

The already tainted Satyam has now placed another 500 employees in a so called “corporate reserve” which is nothing else but bench. This move has further sparked various rumors like possibility of senior-level employees leaving Satyam.

All associates in the sales, operations management, delivery integration, relationships, program management, presales and solutions framework will be now placed in the corporate reserve. These verticals belong to the Enterprise Business Competency (EBS) at Satyam. The company has also mentioned that these resources will remain in reserve till further allocations are informed.

The Chief Marketing Officer, T Hari who is also the Chief People’s Officer mentioned, “With a transition to the new organizational design, some of the erstwhile units like vertical business units and horizontal competency units will cease to exist.”. He further added, “Employees who have not been allocated any portfolio yet in the new organization design will be placed in the unit called corporate reserve.”

It should be noted that Mahindra Satyam had already placed 8,000 employees in a similar situation terming it as “Virtual Pool” yet another name coined for the more simple word BENCH.

Massive job cuts in the name of reorganizing and handful of recruitments to coverup the decrease in revenue has now become a everyday story. L&T Infotech, the country’s largest engineering company has started requesting employees to resign across its Pune, Chennai and Mumbai centers. It is surprising to know that L&T Infotech even with most of its clients in manufacturing industry is facing the market slow down. Read the full story

HP has announced that it would be eliminating 24,600 of its employees. HP, in one of its Security Analyst Meetings stated that is a part of its global restructuring plans.

Many companies in the software, ITES or the EDS industry have been in a ramp down spree recently owing to inadequate projects, global slowdown and high competition. Companies have been showing the pink slip to employees in the name of performance issues. The economic slowdown has affected large companies.

HP’s plan to eliminate 24,600 employees is a huge and sensitive move for the organization. Mark, in one of his updates stated, “By far the hardest part of this effort is restructuring our global workforce and today we are announcing the elimination of 24,600 positions. There is no way to downplay the magnitude of this. The restructuring impacts people, families and communities, and we undertake it with gravity and deliberation.” He also added, “We have the well-being and futures of more than 300,000 employees to consider, and we owe it to all of them to create a business that is healthy, strategically sound and growing.’

The huge amount of eliminations shows the state of the company and the seriousness of employees without projects. Companies are no longer able to hold on to an employee if he/she is not billable even for a month.

The situation has been wide spread among all similar service companies. Industry experts feel that the same heat wave would prevail for further months. Hope we see the light soon in the end of the tunnel.

Satyam Computers, one of the leading software companies in India has joined the list of companies who are in a rapid down-sizing due to inadequate projects.

Satyam has reportedly shown the pink slip to 400 engineers and associates in Hyderabad, Visakhapatnam and Pune.

Most of the employees who were sent off had 2 to 5 years of experience. The employees in a state of shock were aware that things were not so good recently. Many of its employees were in bench for months as Satyam fell short of projects.

Following this, Satyam had been requesting [well, you can even say forcing] employees to get into a contract instead of a permanent employee status in the name of performance issues. Quite obviously, employees did not prefer this option.

After preparing enough reasons against its employees, Satyam showed the way home to 400 employees and associates in its so called ‘S’ band. Employees who have 2 to 5 year experience fall under ‘S’ band in Satyam.

Joining the league of layoff companies, Global Head, HR came up with the same boring answer. He stated to The Hindu that ‘we do this as a matter of routine employee evaluation and development.” He also added one that we are quite used to hearing recently, “We are to hire 12,000 to 15,000 people for 2008-2009″. Can you please stop joking?

Were there performance issues only with the ‘S’ band? Why did Satyam send such a large number of employees only this year? Does that mean they did not have any performance issues last year? If you are going to send off 400 experienced employees and recruit 12,000 more, does that mean that these 400 cannot perform or are good for nothing? Or can we say that you don’t have suitable projects to see their performances?

Can’t these HR come up with a different answer? Obviously, even a dummy will know the real reason. “INADEQUATE PROJECTS”

India’s 6th largest software exporter, Patni Computers has recently laid an estimated 600 employees. The company claims that this action is due to their non-performance issues. However, industry watchers have mentioned that it is largely due to insufficient projects.

Patni with its delivery centers in Chennai, Bangalore, Mumbai, Pune, Noida and Hyderabad is one of the largest software exporters. During its recent yearly appraisal, the employees were shocked to receive a forced resignation letter instead of a appraisal letter. The company informed this to be an exercise to weed out non-performers.

Executive vice president and global head of Patni Human Resources stated, “This was an absolutely regular appraisal that is important for any performance driven organization. It is something standard we do every year. Employees who have got a 0-1 rating on a scale of 5 typically form the basis for the first-level shortlist. These are performance based resignations; we’ve not issued any termination letters.”

An industry expert from Bangalore mentions, “IT companies have to concentrate on educating business developers. IT companies spend huge amounts on business developers. However, they tend to be inefficient and do not have much knowledge about the product they sell. They either quote too high prices for simple jobs or sign for less when it would actually cost more. Both ways the company either loses the project or ends up in additional expenditure”

Software companies are facing a crisis in recent years due to incapability of acquiring new projects. Laying off employees in the name of performance issues has become quite common among IT companies to cut costs.