‘Techies well taken care of, no need for union’

Hyderabad: Employees’ unions are not needed in information technology industry where work ethic is good and the staff are well-paid with techies even finding opportunities outside the company they work for, says a senior industry figure.

Whenever there is a downturn, there is always noise about unions coming into play in the IT industry but it never sustained, said ex-Chief Financial Officer of Infosys Ltd, V Balakrishnan.

“Work ethic is very good and salaries are high. Even today the attrition rate in the IT industry is double digit. It (talk of employees’ unions) always fizzles out after some point of time. It never sustained,” he said.

“But I think even if there is a union, I don’t think it will impact the industry much because IT industry is one of the best paymasters in the country and second, the people find opportunities outside”, he said.

The employees’ unions work in industries where work ethic is bad and where employees are treated shabbily.

Following reports of layoffs and fears about further retrenchment in the slow-down hit IT industry, there had been some talk in recent times about forming a union.

“IT industry is not bad, IT industry people are well taken care of, well-paid, and they find opportunities. Even one of the bad years, this year, where growth rate has come down, the attrition is still double digit.

“So, I don’t find a need for union in this industry. Even if there is a union, I don’t think it will impact the industry much because people are well taken care of in this industry,” said the former Board member of Infosys.

Balakrishnan said the reports about widespread job losses in IT industry are exaggerated.
“If you look at all the leading companies, none of them are talking about huge job losses; they are all talking about the regular performance-based attrition, that is normal in the industry. So, to some extent the scare of job losses is exaggerated,” he said.

He said IT is not a traditional industry. “It’s a global industry where you get global opportunities to work. This industry is different, it’s not like traditional industry. I don’t know whether formal union kind of structure will succeed.”

On if boom times are over for the Indian IT industry, Balakrishnan said: “That’s what we had been told when 2000 dotcom happened…Y2K came up…2008 financial crisis. Same concerns were expressed then.”

“This industry goes through ups and downs, but it always found its feat and went into new areas, I think even this (current) crisis will be an opportunity for them to invest more into new digital, SMAC (social, mobile, analytics and cloud), mobility and new technologies. They will reinvent themselves,” he said.

While it looks like the USD 150 billion Indian IT services industry would log single digit growth in the current fiscal, it’s possible that it could accelerate to double digit next year.

He said it could be so as opportunities are large, IT spending is still very large and the US economy, which is the largest market for India, is growing at one-and-half to two per cent, which is not bad, Balakrishnan said.