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People Pressure

People Pressure

No-poaching pacts will have mixed results in a fast market

Despite the apparent serenity of its verdant 80-acre headquarters, people pressures continue to hound top execs at technology bellwether Infosys, with the company recently putting in place a tweaked no-poaching pact to try and rein in its attrition rates. While broad no-poaching deals have been in place between companies across high-growth industries such as it, retail and hospitality, Infosys has put in place a much narrower programme to prevent employees moving to "named competitors" and working on the same client engagement for a period of six months. "This move was triggered by one of our business units and the need for confidentiality of customer data and IP created during a client engagement," says T.V. Mohandas Pai, Member of the Board and Director, hr at Infosys. While many tech firms have informal no-poaching deals between themselves (which aren't legally enforceable, according to critics), determined techies have continued to find ways to dodge them.

T.V. Mohandas Pai
T.V. Mohandas Pai

Incidentally, despite being perhaps the most preferred employer for thousands of code jocks, Infosys, like many of its peers, continues to struggle with climbing attrition rates. For the quarter ended March 31, 2007, Infosys' attrition rate stood at 13.7 per cent compared to 11.2 per cent for the corresponding period in the last fiscal.

Despite offering competitive salaries and an opportunity to train at its swanky Infosys Leadership Institute, Mysore, Infoscions continue to be lured to domestic and multinational competitors, happy to pay top dollar for their services. "People are our most valuable resource and we invest heavily ($700 million in 2006) in upgrading their technological and managerial skills. We believe that we're a preferred employer in the Indian market," says Kevin Campbell, Group Chief Executive (Outsourcing), Accenture.

Like many other multinationals, Accenture has grown rapidly in India, from zero to 27,000 employees this year, with plans to reach 35,000 by August 2008.

While a company like Infosys sifts through over a million CVs annually (and hires around 20,000-30,000), its status as the most preferred employer in the IT industry is clearly under threat. "We're perhaps the only player in the top five without a no-poaching pact, but this has had no impact on our growth and our standing as a preferred employer," says a Cognizant spokesperson. Infosys may be feeling people pain most acutely in specific areas such as mid-management and certain technical roles, say headhunters. "Project managers are perhaps the most sought after resource in the it industry and Infosys has struggled to keep its flock together," says Kris Laxmikanth, Chief Executive Officer, Headhunters India, a Bangalore-based hr consultancy.

With the IT industry expected to face a shortage of 500,000 people over the next few years, life is unlikely to get any easier for Pai & Co. anytime soon.

Published on: Aug 31, 2007, 5:18 AM IST
Posted by: AtMigration, Aug 31, 2007, 5:18 AM IST