Satyam set to downsize 9% of its workforce

Hyderabad: Satyam Computers, which has just started giving pink slips to its
employees, could potentially downsize its workforce by a whopping 4,500
employees. This translates to a little less than 9% of the 51,000 employees
that the company employs. Company sources say 1,500 employees have been put
under the performance improvement plan (PIP)—euphemism for employees put on
watch list and asked to shape up or ship out. Apart from this, 3,000 others
have not been given any increment in the last appraisal cycle, thereby
indicating that their services are dispensable.
"This 1,500 plus 3,000 equals 4,500, which indicates the total number of
persons who could be eased out of the company,'' the source said.
Intrestingly, on Friday, all employees received an e-mail from the
company chief Ramalinga Raju warning them, especially the ones on the bench,
to not bunk office and be in their best 'dress code', failing which they may
face strict disciplinary action.
Last week some 400 employees from across different locations of the
company were given the pink slip, of which 150 were from Hyderabad. Sources
also indicated that after getting the message many among the 3,000 have also
started leaving their jobs on the own. But an estimate of the employees who
have left is not known.
A Satyam spokesperson said: "The bottom 5% of those who have got a bad
appraisal are put under PIP and given dummy projects to prove themselves. If
they fail they will be shown the door.'' But some of them marked for PIP
said they have been given very little time to come up as winners. However,
even as it downsizes, Satyam continues to hire new employees in thousands.
Over 40% of them are fresh blood just passing out of college.
The spectre of retrenchment is creating panic among employees of India's
fourth largest software company. "Of the 12 people working in my project,
five were suddenly asked to resign, failing which, the company warned, it
would fire us. Everything came without warning,'' said a techie pleading
anonymity.
Employee sources say the plight of the 3,000 who have not got any
increment is pitiable: They are neither on the bench nor into any
highrevenue earning project.
"Some of us cannot quit even though we know we will be eventually sacked.
That's because we have paid a bond amount of Rs 2 lakh undertaking to serve
the company for two years,'' said an employee. Industry analysts say that
despite the current economic slowdown—due to which big projects aren't
coming the way of Indian IT companies—Satyam is still maintaining a buffer
of 3-8% on the bench. "It's like a contingency plan,'' says an analyst.
"Sometimes when a big project comes all of a sudden and the company can't
show enough resources which could be employed to deliver the work, the
company could lose deals. Which is why this inexplicable behaviour,'' he
adds.