Move aimed at IT services major’s US employees
Nearly 400 mid-to-senior level managers at the $17-billion Cognizant Technology Solutions have been offered a voluntary separation package (VSP), mostly aimed at employees working in the US.
The Nasdaq-listed Cognizant employs nearly 2.90 lakh employees globally, with over 75 per cent in India. After Tata Consultancy Services, it is the second largest IT company in India.
The VSP comes at a time when the Covid-19 crisis has caused disruptions across all industries, including IT services. However, sources said the package is part of Cognizant’s announcement in September 2019.
The company had then said that to improve its cost structure and advance its growth agenda, it had made the difficult decision to remove 10,000-12,000 mid-to-senior level associates worldwide from their current roles in the coming quarters. The move was expected to lead to a net reduction of 5,000 to 7,000 roles (about 2 per cent of the company’s total population) in stages, as the company aimed to reskill and redeploy approximately 5,000 of the impacted associates, the company had said then.
Commenting on the VSP without confirming the numbers, a Cognizant spokesperson said: “In a people-intensive business like ours, effectively managing workforce utilisation is a key element of aligning our cost structure with revenue. We routinely manage supply and demand with a bench of unutilised employees. We are enhancing our bench policy by offering additional cash and extended health benefits to those who are or will become unutilised and for whom we unfortunately do not foresee future opportunities. As always, we will treat any employees exiting the business with fairness and dignity.”
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Published on
May 27, 2020
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