Thursday, February 21, 2008

IT layoffs and corporations - Continued

Since I wrote this post, a few people have come to me and said that I have not written the corporation's point of view. I would like to respond to that.
The fact is that post was written because I do not see ANYTHING BUT the corporations' point of view in news media. There is really no criticism or inquiry into whether the corporation is fudging the facts.
We have to note a key fact here - corporations have to be regulated and challenged to be truthful and not to abuse their powers. The truth is that corporations wield enormous power and therefore that comes with big responsibilities and regulation. That is how it works in all developed countries.
Again, these corporations are pretty well behaved in the United States or the UK - only in India do you see them attempt to manipulate the system.
Let me give you a further example - has anybody noticed that the notice period that an employee has to give before leaving keeps creeping up and up? In late 90s it was one month. In some small companies, it now stands at 3 months. In Cognizant it is 2 months, I think. These same companies stick to the 2 weeks notice for employees in the United States. Has anyone wondered why that is? From a corporation's point of view, this is of course, their perfect plan for combating attrition. I would love to see it from their point of view, but their point of view violates all labor regulations.
If left unquestioned, corporations of course would LOVE if employees were bonded labor. There is nothing really like that to combat attrition, is there? What keeps that from happening? Definitely not sudden goodwill. It is labor regulations and the courts that prevent that from happening. Yet, we ignore that it is government regulations that have to force companies to behave. You see postings in online forums all the time about how government should get "out of the way" - but this is precisely why government has to be "in the way".
I know of companies that refuse to give the relieving letter to employees after serving their correct notice periods. Companies that do "creative" salary packages to make sure a part of their employees salaries stays with them if they leave. Let us not pretend that corporations are somehow benign creators of jobs and wealth - it is much more complicated than that.
They have a proper role and that role requires questioning and regulation.

Friday, February 15, 2008

IT Layoffs - Stop blaming the staff

In the recent days TCS and IBM have cut jobs in sight of a looming US recession. This has been widely reported in the media and much analysis has gone through.
I have been reading these news items and analysis, and there is a common thread running through them. A recent Ananda Vikatan article I read prompted me to write this post.
The industry "analysts" and the company's own people are at pains to point out that the employees were fired because of lacklustre performance. It is a regular "weeding", they say and has nothing to do with the company's own performance.
In the case of IBM, the people who were laid off were mostly trainees. These companies recruited these people after different rounds of interviews. Suddenly, when the US market was going down, these guys realized that they had "non-performers" among them?
This is corporate India for you - in the last few years we have become a country that shamelessly celebrates corporations. News media calls them "India Inc" as if they represent India herself. The media have been brainwashing us into thinking that nothing "India Inc" does can go wrong - and that these are men of steely will working towards a common purpose. Most corporate advertisments try to align themselves with patriotic fervor.

The middle class has gotten to think that its interests are closely aligned with those of these corporate masters.
That is why, TCS and IBM can get away with this, without criticism for their spin.
Mind you, I am not saying they cannot lay off - my point is that there is a difference between layoffs and firings. By calling mass layoffs as firings (for performance) the companies are trying to keep their reputation clean. These companies want to keep their sharholders happy - so for naked advantage, they are saying that nothing is wrong with themselves. They are laying the blame on the poor employees laid off. The truth is that TCS and IBM anticipate revenue problems. They are shedding people BECAUSE of the company's problems - not merely because of performance. By shifting the blame on the victims, TCS and IBM are trying to shield themselves.

This is cruel, because our society has no social security net for people fired or laid off. These employees are victims of capitalism and they should be called as such, instead of blaming them. The companies should be honest about this.

The point is also that in modern India, these employees have no constituency. An employer just has to say "This guy did not perform" and everybody accepts it without questioning. Performance is a general word and no one can really cross check.

This reminds me of the 2001 recession when H1B workers started returning to India. The same kind of jeering response rose from our media at that time. The writer Sujatha said that "non-performers were sent back" - as if the American companies were the ultimate arbiter of performance. I was in the United States at that time and I know for a fact that people who were laid off just happened to be in the wrong departments. Entire divisions were cut down.
You cannot call yourselves a capitalist society and then keep jeering at people laid off.