Satyam's headcount figures could well be correct

How many employees does Satyam Computer Services really have? Doubts over the company’s claim of 53,000 employees have arisen ever since founder B Ramalinga Raju’s January 7 confession to fraud.

On January 24, public prosecutor Ajay Kumar, arguing on behalf of the Andhra Pradesh Crime Investigation Department, told the court that Raju had admitted, under police interrogation, that the company had only 40,000 employees.

The next week, however, the government-appointed six-member board of Satyam emphasised that there was sufficient data to suggest the company’s claims were correct. In New Delhi, Tarun Das, a board member and CII chief mentor, told reporters the headcount could be 50,000.

On the other hand, the Provident Fund Organisation said it had 43,622 accounts of Satyam employees and the Income Tax department had reportedly disclosed that the company paid Rs 250 crore as Tax Deducted at Source (TDS) for 44,000 employees in 2007-08.

So what’s the correct number? According to the company management, the provident fund (PF) account tally does not include its associates who are foreign nationals and who do not fall under India’s PF regulations.

Satyam has operations in 66 countries and sources said more than 100 people worked in each of these countries, accounting for 7,000 staffers. The PF accounts also do not include the people employed by Satyam subsidiaries in countries like China and Brazil or the associates of Satyam BPO and other companies it acquired globally (Bridge Strategy, Citisoft and S&V).

“We stick to that 53,000 figure,” said Hari Tallapalli, Satyam’s global head, marketing and communication, adding that an internal verification had indicated that there was no reason to doubt the number.

Tallapalli could not, however, give an exact figure. But he said Satyam was working with audit firms reviewing the headcount data and their findings were expected to reaffirm the company’s figures.

Raju’s counsel S Bharat Kumar also said neither the investigation agencies nor the media have come up with evidence that the employee numbers were fudged.

When Satyam announced its second quarter results this year, it stated that it had 48,434 associates, an addition of 1,814 associates including 221 trainees. Twelve to 18 months ago, the company said it had sent offer letters to 6,000 people who were yet to be brought on the rolls.