The fourth-quarter financial performance of Infosys, the country’s second-largest information technology company, failed to bring cheer to both investors and employees.
The Bangalore-based IT bellwether generally announces its annual pay rise in April; it has decided to withhold it. It said the management might revisit the decision in the middle of the year, based on market conditions.
Nandita Gurjar, its senior vice-president and global head of human resources, said: “Our employees understand the problems of the company. They are behind us and they are the major stakeholders. Most of our employees were aware of this from their business units about the conditions. This was a known thing for many. We formally informed them today morning.”
During the financial turmoil of 2008, Infosys took a similar measure on salary rises, in the first couple of quarters. In the same year, employees were given a rise of around 10 per cent in October. “We have done this earlier and have revisited our own plans, based on market conditions. We might relook at this in the coming quarters,” said chief financial officer V Balakrishnan.
Though there will be no salary rise as of now, the company has promoted around 16,000 employees with effect from April 1. The promotions were across the board, it said.
When asked if the no pay rise decision would result in more people leaving, Gurjar said such attrition goes up in the first quarter of every year, as employees leave for higher studies. However, the company said it was going ahead with hiring plan; it would give jobs to another 35,000 people this financial year. Of these, 13,000 will be joining its business process outsourcing wing. The number is 10,000 less than the hiring done in 2011-12. Infosys employed 149,994 as of March 31 this year. The company also said there would be no deferring of hiring of freshers from campuses.
The total hiring includes 18,000 campus offers Infy has already made. The company is also planning to make 1,200 new local hires in America, where it has already added around 1,200 people in the past 18 months.
Infosys’ attrition rate, excluding its subsidiaries, has come down slightly to 14.7 per cent as against 15.4 per cent in the previous quarter. The utilisation rate (excluding trainees) has also come down to 75.6 per cent for the year ended March 31, as against 78.9 in the corresponding period last year.