Satyam issues pink slips to 200 employees

‘It’s routine performance improvement procedure, not cost cutting’.

Satyam Computer Services, the fourth largest IT solutions and service provider, has reportedly given pink slips to 200 employees in various centres, a few weeks after the company announced its second quarter results.

While the company insists that the move follows the annual appraisal, which usually happens in July-September, and that it is in no way connected with the slowdown, employees say it actually is part of cost-cutting measures to reduce high-cost human resources.

“They are saying that they are continuing to recruit people. But the thing is they are replacing high-cost human resources with low-cost HR as part of the cost-cutting exercise,” a Satyam executive, who was shown the door recently, told Business Line.

Mr S.V. Krishnan, Global Head (Human Resources) of Satyam, denies this charge. “We reiterate that this is not unusual. This development follows the appraisal where the 5-10 per cent of staff in the bottom of the performance pyramid is identified for Performance Improvement Plan,” he said.

“They (those who are in that bracket) do know that they are in that list. While some of them exit themselves, we will sit and talk with others for their possible relocation. If they insist that they be accommodated in the local projects and continue to reject the proposals (for relocation), it could be a problem,” he said.

A Satyam staffer, however, argued that even performers were getting the pink slips. “I’ve proved myself in several important projects and got accolades from the higher-ups too. It was a complete surprise for me to hear that non-performance was the reason for my removal,” a former Satyam executive, on condition of anonymity, said.

When asked about the removal of some performers too, Mr Krishnan said, “We have been recruiting in thousands this year too. In that scenario, why would we remove experienced hands? Would that sound logical?”

The company, which had indicated early this fiscal that it would recruit 15,000, had scaled down the intake outlook to about 10,000 due to the slowdown.

Cutting cost

Asked whether the company was considering cuts in salaries and perks following the slowdown, he replied in the negative and said that the company had begun cutting down travel costs and expenditure on parties.

“This is where we doing some cost-cutting and not by removing people,” he asserted.

Source: TheHinduBusinessLine