An Indian technology workers’ trade union has vehemently opposed IT giant Tata Consultancy Services’ (TCS) decision to lay off over 12,000 of its workers, which is 2% of its total workforce. The Karnataka State IT/ITeS Employees Union (KITU) has strongly condemned TCS’s layoff decision, calling it “illegal” and a gross violation of Indian labour laws.
The left-wing union, which has become a leading organiser of technology and allied services’ workforce in Karnataka, the state that houses what’s called the Indian Silicon Valley, has demanded government intervention to stop TCS’s re-trenchment immediately.
Suhas Adiga, KITU’s general secretary, says, “As per the Industrial Disputes Act, it is a punishable offence for an employer to compel an employee to resign. Every employee has the legal right to refuse to sign a forced resignation.”
“This action is completely illegal and qualifies as an unfair labour practice under the provisions of the Industrial Disputes Act. KITU urges the TCS management to respect the law of the land and immediately reinstate all retrenched employees,” Mr Adiga stressed.
According to the TCS, its layoff decision, which will throw a large number of senior and mid-grade workers into uncertainty, stems from its aim to become a future-ready organisation. As of June 30th, the technology giant had 613,069 employees across different offices. Among these, 12,261 are likely to face the axe.
The TCS management has asked managers across all levels to suggest names for pink slips. CEO K Krithivasan has denied that the firings are caused by the advent of artificial intelligence; rather, he blamed skill mismatch for the decision.
While KITU strongly opposes TCS’s layoff, Mr Adiga said the organisation is approaching the Labour Department against this unlawful move by the company’s management.
“As per labour laws, any company employing more than 100 workers must obtain prior permission from the government before carrying out any retrenchment. In this case, thousands have been retrenched without obtaining such permission, which is a serious violation,” Mr Adiga mentioned.
Mr Adiga called for building a strong movement to stop the retrenchment. “KITU stands in full solidarity with the affected employees of TCS and strongly urges them not to resign under pressure. Instead, they are requested to contact the Union helpdesk,” Mr Adiga said, sharing the numbers — 9663458279 / 9742045570.
“KITU calls upon all the IT/ITeS employees to come forward in solidarity with the employees of TCS and against the inhuman practice of forced resignation,” Mr Adiga emphasised while asking the employees not to panic and not resign at any cost under pressure.
It’s not only KITU that is apprehensive about TCS’s layoff decision. Even the stock investors became wary of the situation. According to reports, TCS’s layoff decision has led to a nearly 2% fall in its stock prices.
On Monday, July 28th, the TCS’s stock price dipped 1.69% to Rs 3,081.20 on the BSE. At the NSE, it went lower by 1.7% to Rs 3,081.60.
The TCS step indicates a crisis in India’s export-oriented technology companies. The lack of innovation and reliance on offshore contracts have hampered the sector’s growth beyond servicing foreign companies.
With the West, especially the US, unable to cope with its financial crisis, the spiralling effects will also impact countries and corporations reliant on the West’s economy.
At a time when the Indian economy is suffering due to rising unemployment, TCS’s layoff decision will create more uncertainties and reduce the scope for many.
Following the TCS’s layoff, it remains to be seen how many more technology companies will join the bandwagon.
