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Saturday, May 27, 2017

10,000 to 15,000 IT employees in Pune may lose their jobs

IT companies are threatening to blacklist the techies if they refuse to resign:

IT industry layoffs: 10,000 to 15,000 IT employees in Pune may lose their jobs

The Forum for Information Technology Employees’ (FITE) Pune Chapter has helped a few Cognizant employees file pleas in the office of the labour commissioner.

Elavarasan Raja, who is a member of the Pune chapter of FITE told the Indian Express that they are hoping to file similar petitions for employees of other companies, which have allegedly started to layoff their employees.

The pincer attack of visa restrictions and automation have made an impact on employment in the IT sector.

Recruiters have predicted that the IT industry may cut as many as 2 lakh jobs in this fiscal.

FITE sources have told the Indian Express that as many as 10,000 to 15,000 IT employees may lose their jobs in Pune alone. The sector employs some 3.5 lakh people in Pune.

Read more at - IT industry layoffs: Cognizant staff take tech giant to labour commissioner; FITE sources say sector may see 10,000-15,000 jobs lost in Pune alone

IT Employees, Know Your Rights - Forum for IT Employees:

Related Story:

2) Cognizant President Rajeev Mehta writes to employees, assuages layoff concerns

1) Job crash in IT industry may crash Pune real estate market

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  1. Tech Mahindra Ltd has sold it's 13 acre plot in Bavdhan, Pune to monetise the land and raise money. It also said that the land no longer fits into its expansion plan for Pune. Property consultant JLL India is the transaction adviser to the deal.

    This shows that IT cos are no longer interested in expanding in Pune. This was also evident when MIDC didn't get any response for further expansion of Hinjewadi IT park as well.

    1. Well here is my take on this IT has a cyclical just like all other sectors. Most of the banks ( EU and US ones ) are setting up captive units in India. This will reduce the need for onsite. Plus US which is the major contributor to IT revenues has tightened the visa norms. Third factor being automation which is making lot of jobs redundant. It's a sad story, instead of firing companies should actually re skill them. I am sure this is a phase and it will be over soon.

    2. Sandy,

      The problem is that there are many people in the IT industry who were content just doing manual activities without trying to improve in other areas themselves, who did not ask for release from a routine comfortable well paying job to take on challenges.

      Companies, when faced with the choice of retaining 5 out of 20 resources, will always retain and retrain the 5 who have taken some effort to keep themselves up to speed on necessary skills, who ask and deliver on challenging assignments, who have the capacity to think a problem through and offer multiple options and recommend the best one.

      I'm sorry to say, that kind of person is not a common sight in the many IT firms i have worked in so far.


    3. Yes true, some bedtime reading how automation and robotics will change the job demographic and higher education

    4. And this latest news from TechMahindra, Pune. First TechMahindra sold land, now layoffs.

      IT Employees' Forum Petitions Labour Commissioner Over Tech Mahindra Layoff -

      IT companies have been one of the largest recruiters in the country. However, they have warned that increasing automation of processes would lead to reduction in hiring in coming years.

      Pune: FITE has requested the Maharashtra Labour Commissioner to order Tech Mahindra to stop illegal removals of IT employees immediately, and establish conciliation between the management and staff.

      However, Tech Mahindra has denied the claims of layoffs saying, "We continue to implement strategies to meet the changing demands of business in the current global economic environment. As a performance driven organisation, we assess employee performance on a regular basis and take necessary actions wherever necessary".


      The Growing Concerns Of IT Industry And Its Workers -


    5. TMB, good to hear this from horse's mouth. Before blaming the company, it's better to look within. Just the way many IT chaps have put their frustration on cos on social media, there are also some who said how leaving IT sector couple of years ago was their best decision.They have given this with reasons & explanations. One such guy is ex-Infy.

      Thanks for the link. Automation is not feasible till labour is cheap. But in IT as salaries hit the roof & employees wanted even bigger & fatter packages for same job, automation started to look lucrative. So to large extent, IT employees too are responsible. Had they accepted salaries at par with their counterparts, they would still have had good job.

      Layoffs in IT firms will hurt the realty sector -

      IT professionals form an important chunk of homebuyers. This is particularly seen in places like Navi Mumbai and Pune in Maharashtra, apart from Bengaluru, Hyderabad and Noida. IT companies drive both the residential and commercial real estate markets.

      The real estate sector has been in a recession in the past few years . The reason — exorbitant realty prices and stringent home loan conditions coupled with high interest rates.

      According to MCHI-CREDAI, a leading association of builders, jobs cuts were bad news for the realty sector.


  2. There is no option but to put on resignation on table. Do IT people think companies are doing social charity? Have they observed any kind of lock in period in employee-employer contract while accepting appointment letter? There is no such thing called job security in pvt sector. Also the actual no layoffs are supposed to be much more than above mentioned number.

    Truth is always bitter. In last 10-15 years, IT people have become too greedy and entered in comfort zone of getting used to salary increments every year. Now they don't want to break this comfort zone & accept severe decrements. Reskilling will work only for young professionals. Why do one expect IT company to re skill & pay hefty salaries if they can get good people at lower salaries?

    1. Completely agree with you. Being laid back in comfort zone is the culprit here. And more I would say, the chalta hain attitude. The moment the paymasters don't see much value in what IT cos are providing at given cost, they will ask for price reductions, which in turn puts pressure on IT cos. As humans form max cost component in IT sector, automation is the easiest way to maintain good bottom-line as well as to cut the flab. There is stark difference in revenue per employee between Indian IT cos & that with American cos.

      Cos like Wipro had informed that they will reduce atleast 30% workforce within next few years in 2015 itself. Don't know why IT guys didn't woke up 2 years ago. You may find this news of 2015 if you do some search. It is there on one of Ravi's blog also.

  3. Read this - Jun 02 2017 : The Times of India (Pune)

    Take pay cuts to avoid layoffs: NRN to seniors

    Asks Cos To Reskill Youngsters & Take Advantage Of Emerging Opportunities
    Infosys co-founder N R Narayana Murthy on Thursday said senior leaders in IT companies should consider taking salary cuts instead of laying off youngsters, and encourage these employees to re-skill so that companies can take advantage of new opportunities emerging in the industry .

    Murthy , who was speaking to ET Now, said this was the strategy Infosys adopted in 2001 when the market turned tough following the dotcom bust. “...we all sat together and then we said, let us make some sacrifice for youngsters. Let's not postpone joining dates and demonstrate commitment by senior people taking salary cuts based on disposable income,“ he said, in response to a question on reports about layoffs, and employees petitioning labour commissioners.

    “I have a feeling that it is possible to save the jobs of youngsters,“ he said, noting that many of them may have families depending on them.

    Major IT companies are planning larger than usual layoffs this year, following a decline in business and the industry's shift to newer technologies like cloud, mobile and machine learning that have made older skills less relevant.

    Murthy said the industry leaders should identify new areas of opportunity , mount training programmes in those technologies for youngsters, and give them enough opportunity to pick up those technologies.

    “And then, tell them you have to work harder and ensure you are in a position to add value, otherwise we will not have opportunity for you,“ he said.

    Murthy has been a long-time proponent of what he calls “compassionate capitalism“, and he reiterated the philosophy on Thursday , describing it as “capitalism in mind, socialism at heart“.

    “It looks at fairness, looks at ensuring that everyone is better off,“ he said.

    On efforts to create labour unions, Murthy said that as long as IT leaders embrace compassionate capitalism, there is no place for unions in the industry .

    “I am not a great fan of unions but if leaders do not embrace compassionate capitalism, if they do not feel the pain of youngsters, then automatically , those people will embrace unions and that in the long term is not good. While in the short term, unionism may appear to be a good solution, in the long term it will fall into hands of people who may not have the best interests of the IT industry ,“ he said.

    In line with this philosophy , Murthy and some of the other co-founders of Infosys had also objected to steep increases over the past 18 months to Infosys CEO Vishal Sikka and COO U B Pravin Rao, and a huge severance pay to former CFO Rajiv Bansal.




    1. But thing is promoters themselves are selling off their stakes & exiting the company. Is it because it's a sinking ship ?
      As far as NR Murty is concerned, he is one of the biggest hypocrites in this country.

      Wipro promoters in early stage of evaluating sale of part or whole business -

      Founder and chairman Azim Premji and his family are considering an exit in part or full, either to a strategic buyer – a multinational IT services company – or a private equity player.

      The promoters of Wipro Limited, India’s third-largest IT services company by revenues, are in the early stages of evaluating the sale of the company or some of its units and have approached investment banks to arrive at fair value, a senior banking source told Moneycontrol.


    2. After Wipro, same story with Infy.

      Infosys founders looking to sell their stake in company -

      An era in Indian corporate history might be drawing to a close. The much-celebrated co-founders of Infosys are exploring a sale of their entire 12.75% stake in the company worth about Rs 28,000 crore, people familiar with the development said.


  4. Mass lay-offs’: Labour commissioner’s office holds reconciliation meeting for IT, telecom firms -

    Spearheaded by the Forum of IT Employees (FITE), employees in Pune had knocked on the doors of the labour commissioner against their retrenchment which, they said, was illegal.


    Infosys, Wipro, other IT companies exploring 'uberisation of workforce' -

    PUNE: Pune-based Persistent Systems recently broke away from traditional practices by including several freelancers and consultants in a team that worked on a short-term project, a relatively new idea that's steadily gaining popularity in the global technology services space.


    Seems contractual employees will be there even in IT now which was earlier limited to blue collar workers.