MphasiS restores shift allowance for apps staff

MphasiS has restored the day-shift allowance of Rs 300 per day for employees at its applications delivery division with effect from June 11. The EDS-owned company had withdrawn this allowance from June 1 following a review of its shift policy sometime last month.

This allowance was being given to applications delivery employees at levels 1-7 (those with up to seven years of work experience) doing the day shift beyond 10 pm everyday.

The shift allowance of Rs 500 per shift for employees working between 10 pm and 6 am remains untouched. The company had also spared on-call allowances given for shifts undertaken on weekdays and weekends/holidays for applications and ITO (Infrastructure Technology Outsourcing) staff.

An employee is expected to work for a minimum of six hours to be eligible for shift allowance. The spokesperson for MphasiS could not be reached for comments. The move to revoke the day shift allowance had attracted criticism from many employees in the company’s applications development and delivery division, who felt that they would lose Rs 1 lakh or above in earnings every year. Shift allowances have been a key incentive for many employees joining the company.

MphasiS has been keen on cutting down variable costs in its operations, though margins in the third quarter 2008-09 have been “satisfactory”, sources said.

About 75 per cent of MphasiS employees are understood to be working on different shifts. Under the current rules, employees who extend their work hours because of an operational emergency, are eligible for shift allowance. Shift allowance is also provided to employees in production and operations, while those in training, parallel operations, knowledge transfer and on the bench do not qualify for this benefit.

The company’s applications development and business delivery division has around 15,000 employees. The application business represented about 63.80 per cent of MphasiS’ total revenues in the second quarter of fiscal 2009. The ITO business fetched 18.70 per cent of total revenues. MphasiS has a total workforce of around 34,000 people.

For the second quarter ended April 30, MphasiS reported a 219.10 per cent growth in profit after tax (PAT) at Rs 224.50 crore from Rs 70.30 crore earlier. Total revenues for the year crossed Rs 1,000 crore, with consolidated top line at Rs 1,048.50 crore, increasing 52.30 per cent from Rs 688.40 crore in the same period fiscal 2008. The company hired 3,822 people, including 117 freshers, to support growth during the quarter.