Coronavirus impact: Wipro starts benching employees as business takes a hit

Wipro Ltd has started benching employees in its Pune campus at the back of COVID-19 pandemic. These employees include those working in the travel and hospitality vertical of Wipro’s BPO arm.

Following this, the Maharashtra-based IT union, National Information Technology Employees Senate (NITES) has written to the Pune labour commissioner.

In the letter, NITES said, “On behalf of NITES, Maharashtra we would like to bring to your notice that we have received complaints from employees of Wipro BPO Pune Phase 2 Hinjewadi regarding putting employees on bench to maintain profitability of business under COVID-19 pandemic.”

“The company has also notified the employees on April 23, 2020 that they are on bench with immediate effect. Because of this, pay and jobs of more than 300 employees are at risk,” the letter added.

According to the letter, the move is a strict violation of Maharashtra government’s rule that employees should not be impacted because of COVID-19.

Moneycontrol has seen the copy of the letter sent to the labour commissioner.

Most of the IT/ITeS firms during their FY20 Q4 results commented that they expect June quarter to take the worst hit and suspended guidance due to lack of growth visibility. Firms also hinted they expect pricing pressures, project deferrals and demand drops due to the virus outbreak. In a bit to cut costs, the companies have put a freeze on hiring and suspended promotions and wage hikes.

In an email response to Moneycontrol, Wipro said, “The speculation related to the workforce is unfounded and has no basis. Wipro categorically denies these malicious rumors. Wipro reiterates that there are no retrenchment plans. Also, we request you not to misrepresent or misinterpret intra-company surveys that are undertaken from time to time on various topics. The company has well defined policies and people practices in place to take care of its employees.”

At the same time, a senior employee, who spoke to Moneycontrol and was benched recently, said that he and his colleagues have been put on bench late April. They continue to receive their salaries. What they fear, the senior employee said, is what is likely to follow if they are unable to find projects.

"Once employees are on bench, they are given certain period of time to find projects. Unlike other times, number of projects are limited due to the virus outbreak and hence more challenging. It is unclear if they would be laid off in cases if they are not redeployed," said the employee

Wipro during its results announcement said that it expects pressure on margins. Jatin Dalal, CFO, Wipro said that this is worse than the 2008 global financial crisis due to its unpredictability. It also suspended revenue guidance due to lack of clarity and deferred promotions and wage hikes.

According to a CNBC-TV18 report after the company’s Q4 results, the company is considering all options including sending staffs on furloughs and leaves as the company prepares for revenue hits due to the virus outbreak.

Saurabh Govil, Chief Human Resources Officer, Wipro said in the report that, "We will look at if people can go on furloughs and leaves. If sub-contractor costs can come down and if we can deploy people there. We will have to cut costs wherever possible. These are tough times and we may have to take tough decisions."