US crisis perils bonuses in BPOs
With US economy headed for a recession, there seems to be an attempt by the BPOs to hold back bonus payments, reports V Ganesh.india Updated: Jan 28, 2008 02:56 IST
Vishwesh Narayan (name changed), a 27-year-old executive working for Mumbai-based WNS, is yet to receive his performance bonus for the October-December quarter of 2007 – something in normal course should have been in by now.
Same is the case with Anuradha Chaturvedi (name changed), an employee with Delhi-based EXL Service Holdings.
“I am in the collections team that handles queries on housing loans from a US-based major and I am yet to receive my performance bonus for the quarter gone by despite meeting targets,” says the WNS executive. He estimates that approximately 70 executives in other departments in his company have not got their bonuses from October 2007 onwards. Agents and executives in business process outsourcing companies are given performance benefits every month.
With US-based mortgage lenders laying off workers and shutting down operations in the US and appreciating rupee hitting profit margins of BPO companies, there seems to be an attempt by them to hold back bonus payments, employees say.
The US economy could be headed for a recession triggered by the sub-prime loan crisis that followed reckless bank lending of home loans to borrowers with poor track records. Indian BPO companies are among key service providers for these lenders who are at the heart of the crisis.
Mortgage lenders including IndyMac and Greenpoint are among the key clients of India-based BPO units.
In a recent email to its employees, CEO Mike Perry of IndyMac Bancorp, the ninth largest mortgage lender in the US, announced job cuts including those outsourced mainly to India. Approximately 400 workers are employed in EXL Service Holdings, WNS and other BPO units for the client. When contacted, EXL’s chief operating officer Rohit Kapoor said that there won't be any job cuts and employees affected will be absorbed into other processes.