7,000 Satyam staff in half-way house
For the next six months, about 10,000 Satyamites will have to live with less than half of their salary and a fear of never being called back to work, reports HT Correspondent.business Updated: Jun 11, 2009 22:13 IST
For the next six months, about 10,000 Satyamites will have to live with less than half of their salary and a fear of never being called back to work.
Satyam Computer Services has decided to put around 7,000-10,000 of its ‘excess’ staff on a ‘virtual’ bench for the next four to six months during which they will be paid 40% of their salary and need not go to office, the company’s Board members decided in a meeting held on Thursday.
During the period, the company can call any of these employees to work but whether or not they are required after the end of six months will depend on the business.
This is a cost control measure from the company that is trying to deal with the double whammy of a loss of business following the revelation of India’s largest corporate scam in January this year leading to higher human resource expenses than returns and a recent change in ownership. The move will impact those who have not been on billable assignments for over the last three months.
“The events of January 2009 and the consequential uncertainties in the initial weeks thereafter resulted in customer losses and revenue reduction, despite of our best efforts. This has also resulted in release of associates from such billable assignments,” AS Murthy, chief executive officer at Satyam wrote in a mail to its employees.
At the end of March 2009, the company employed a total of 41,622 people. Last month, Satyam’s new owner Tech Mahindra had said that the former has an excess of 10,000 people. The company also said that a failure to control its increased people cost would result in a reduced investor and customer confidence along with an inability to make timely payments to associates and vendors.