India to Receive Big Pay Hike in 2010

Hong Kong: Companies in Asia are set to offer bigger pay rises next year as the region continues to rebound from global recession, notably in India where base salary levels are poised to jump nearly 10 percent. According to a survey by Hewitt Associates, salaries in Indonesia and China will also surge, by 8.7 percent and 6.7 percent respectively, whereas workers in Japan can expect a paltry 2.1 percent pay rise.


The survey, which covered more than 2,000 local and joint-venture companies in the Asia-Pacific region, also states that salaries or annual guaranteed pay this year in Asia's fast-growing economic powerhouses China and India, at 4.5 percent and 6.3 percent respectively, were the lowest since 2005.

Salaries barely grew at all in Hong Kong and Japan, this year as companies cut staff, reports Reuters. More than 60 percent of companies surveyed in Hong Kong, Japan and Singapore froze wage levels, compared with only 26.1 percent in India and 30.8 percent in China.

Next year, only six percent of companies in India and 8.3 percent in China expect to freeze pay compared with 12-14 percent of companies in Japan, Singapore, Hong Kong and Australia.

Cheer Up!! Hiring and Salary Hikes are Back

Bangalore: Many were predicting six months back that the Indian IT industry would be entering its twilight zone, but now there are indications that these predictions may go wrong. Several IT companies have restarted hiring and are giving salary hikes to their employees.



"That phase of drastic downturn is behind us," says S Ramadorai, CEO of Tata Consultancy Services (TCS). "There's stability now. The deal pipeline is encouraging, but the time it takes to close a deal remains long. And many customers are yet to fully open up their IT budgets," Ramadorai added.

While IT majors like TCS, Wipro and Cognizant have started promotions and salary hikes, Kris Gopalakrishnan, CEO and Managing Director of Infosys feels that things are looking better now, however the company prefers to wait and watch before giving any promotions or hikes, reports The Economic Times.

The recovery of the defamed Satyam Computer Services under the new owner Mahindra Satyam has also proved to be a boon for nearly 28,000 employees across all levels, with the restoration of the variable pay. The variable component is 10 percent at the entry level, 20 percent at the middle level and 30 percent at the senior management level. IT bellwether Wipro has lifted its freeze on hikes and promotions, at least for some employees.

Manpower supply company TeamLease, which saw its open positions drop significantly from 10,000 a month to 800 post-recession, has in the past couple of months seen those numbers rise to 3,500.

With the current trend companies have also started showing more confidence in the Indian market. Information infrastructure company, EMC has announced that it will invest $1.5 billion in India over the next five years, a level of investment from a single company that the sector has not seen in close to two years. Partha Iyengar, Regional Research Director in Gartner India, says the number of calls the company gets from customers for directions and consulting has gone up sharply in the last 3-4 months.

The Indian IT industry was one of the worst hit by the recession on account of its dependence on international markets - especially the U.S. and European markets. The freeze on IT budgets by companies around the world meant that new orders dried up. Industry association Nasscom initially forecast that IT exports would grow by 22-24 percent in 2008-09, but as the recession deepened, this was revised down to 16 percent. For this fiscal, the association has projected a 4-7 percent growth to $48-50 billion.

HCL Technologies Salary Increments Frozen, Bonus Cut

http://www.business-standard.com/india/news/hcl-goes-for-salary-freeze-bonus-cutbacks/353832/

IT major HCL Technologies has decided to mitigate pressures on operating margins by freezing salary increments through 2009-10.

The company has told its employees that there won’t be wage hikes for the financial year ending July 31, 2009, due to tight demand in the US and Europe, declining volumes, and the need to further tighten expenses across business divisions.

In a harsher step, the company has slashed retainer bonus, which averages 10 per cent of an employee’s salary, from April 1. Travel allowance has been sharply reduced, if not curbed, in most cases. “HCL is discouraging travel requests, except in exceptional cases related to onsite employees. The option for an employee to use his travel allowance has been minimised,” said an HCL employee.

An HCL spokesperson said the recent communication with employees was part of a routine process under which the leadership of the company reached out to employees across the organisation to take stock of the current business environment, changing customer requirements and to together arrive at a comprehensive strategy.

“With increased focus on delivery excellence and operational efficiency, the strategy will enable the organisation to find opportunities in the current environment and carry forward the growth momentum,” said the spokesperson.

The company is also said to be looking at suspending matching contributions to employee retirement plans. Onsite allowances have also been slashed, though the exact quantum in this case is not clear.

Chief Executive Vineet Nayar is known to have met employees of the Chennai office recently, where these cost-cutting measures were spelt out. It is learnt that while the company has not gone for salary cuts at this point in time, a 25 per cent salary cut for employees on the bench has been considered. “Salary cuts were considered, but were not carried out. Instead, employees are now being charged for frills like coffee and refreshments,” said a source.

In January, HCL had said that it would reduce about 280 jobs, or 8 per cent of its global workforce, and implement other cost-cutting measures. The company is learnt to have laid off about 450 people from its British Telecom practice. Redeploying bench resources, which constitute roughly 20 per cent of HCL’s workforce, continues to be a challenging prospect for the company.

Many employees on the bench have been given up to two chances for redeployment on a new project, failing which they have been given the option to leave, sources say, adding that each fresher is being given up to two client interviews.

Besides shrinking IT spends in its key markets of North America and Europe, HCL’s acquisitions of Liberata Financial Services and Control Point Solutions ($20.8 million) last year are believed to have affected its EBITDA margins — which grew 1.1 per cent to 22.5 per cent on a year-on-year basis during the second quarter ending December 31 last year. To add to HCL’s woes, its forex losses owing to the depreciation of the rupee in Q3 of the 2009 fiscal expanded to $207 million from $156 million a year earlier.

Infy to hire 20k engg grads at over 8% higher salary

Source: TheEconomicTimes

India’s second-largest software company Infosys will be inducting almost 20,000 engineering graduates this year at over 8.3 % higher salary from what was offered last year, even as the company seeks to cope with a lower demand for software services in its top export markets such as the US and Europe.

At a time when other industry rivals such as TCS, Wipro and HCL Technologies are deferring the
joining dates for new hires, Infosys is holding on to its commitment and that too at better salary levels than last year.

“We have increased the pay package from Rs 3 lakh per annum to over Rs 3.25 lakh per annum for those joining in June this year,” Nandita Gurjar, senior vice-president and global human resources head, Infosys, told ET in an interview. “The idea is to get the best talent even during this slowdown, to provide better training and prepare them for the projects,” she added.

Experts such as Prashant Srivastava, managing partner of Gallup Consulting, said that top tech firms want to retain their edge as preferred employers in the industry. “Proactive companies are preparing and hiring high performers for the future, as they don’t want to run after talent once economy revives in few years,” he said.

The offer letters and dates of joining have been sent to 20,000 freshers (2008-09), and the process of joining will start from June this year. Last year, Infosys recruited almost 18,000 (2007-08) engineering graduates.

The company has also increased the training period for new recruits from the current four months to almost eight months. “It gives them better understanding of a project because the predictability of what kind of work you will get is much lower than what it was last year,” said Ms Gurjar. Infosys visits some 1,100 engineering colleges every year.

At a time when the US government is mulling stricter work permit regulations, Indian tech firms such as Infosys will need to deliver more projects from India. “We have been preparing from past three years to reduce our dependency on H1B visa, which is hiring more and more locals in all the countries, where we work,” said Ms Gurjar.