Infosys encourages employees to go on a sabbatical and work for NGO’s

In the first time ever kind of move, Infosys has provided an option to employees to go on a sabbatical and work for NGO’s for a year. For an employee to qualify, he or she should be with Infosys for at least 2 years. Employees will be paid 50% salary during this time and the rest can be recovered from the NGO’s they are working with.

This news caught my attention for two reasons. One is the salary cut element. The other is the non-governmental organization (NGO) and Corporate Social Responsibility element. When I go through my feeds or the newspapers, what I see is either the job cuts or salary cuts or both. This is in addition to the bankruptcy and the recession talk. The job cuts are mostly coming from global companies but, Indian companies are not far behind.

Labor laws are a little strict in India and protect the employees in the private sector to some extent. This restriction has forced companies to look at alternative ways for reducing cost and work force. For this they are employing innovative ways. Weeding out non performers, firing over fudged bills and threatening to terminate are the things we have seen so far. But, 50% salary cut and going on a sabbatical is very new, innovative and takes the cake.

Coming to the second element which is working for a NGO element, drives the discussion to Corporate Social Responsibility (CSR). The BS report states that, it is Narayana Murthy’s dream and has been on the cards for a while. It is the way one can give back to society. The details of this are still being worked out. It is purely voluntary and left to the employee to opt for it. I only hope more companies would follow Infy. I wish my company was offering this.

I would like to believe the reason is more to do with the CSR element rather than the cost cutting element. But, the timing of the move has coincided with turbulent times. Only time will tell if this was a strange coincidence.

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Indian IT firms pose threat to hospitality industry

IT and ITeS companies in India are also the biggest hospitality players in the country. The need of accommodating their clients and visitors luxuriously and decently is prompting several IT majors to maintain their own accommodation facilities, reported The Times of India.

While Infosys Technologies has a country wide room inventory of 13000, Wipro has 500 rooms across three of its facilities in Bangalore. A little part of these rooms are meant for trainees - Infosys allots less than 40 percent of its r ooms to its trainees- a lion's share of those facilities are meant for visitors and are of a quality that compete with luxury hotels.

TCS, Satyam, HCL, IBM, Accenture, and HP too have their own or outsourced accommodation arrangements for their clients and and employees traveling for site visits.

These options save a huge amount of money for these companies as arranging accommodations for their clients in big hotels is highly expensive. For instance, Wipro gets about 500 visitors a day. And also 6000 employees of the company travel every day between various facilities of the company. It would have incurred a big amount if the company did not have their own accommodation.

According to TV Mohandas Pai, HR head Infosys, "A hotel room night costs $150, and it will cost us $25000 to put up 175 foreign visitors. That is around $10 million for a year. And to put up 6000 employees, it will cost Rs 1.5 crore a day. So even a 50 percent saving in this is big for us."
While Infosys charges Rs 1250 per night for their rooms while Wipro takes Rs 1000. However this is adversely affecting the hospitality sector as Bangalore alone has 1200 to 1300 rooms of IT and ITeS companies that directly compete with higher-end hotels. And this company facilities, that have 100 percent occupancy, has grown by 20 percent over last year. This happens at a time when hotel occupancies are down by 55 to 60 percent.

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