A serious issue

I saw an interesting article in ET today. According to the article, top IT companies in India like Infosys, Wipro, etc have decided to ask their employees to sign a non compete agreement. The gist of the agreement is that if an employee of any of the following companies- Infy, Wipro, TCS, Cognizant, Accenture, IBM- quits his job, then he/she is not free to join any other company from the above list for 6 months from the date of termination.

The link to the article is: http://economictimes.indiatimes.com/articleshow/2102946.cms

Such an agreement has serious implications to IT employees, who have fallen into the habit of changing companies every 18 months or so. There is no doubt that if this policy is comprehensively implemented then the sky high attrition levels in the Indian IT industry will fall drastically and will consequently help IT companies cut costs. But it also raises many important issues. The most important one is the issue of employee rights. An extract from the article: ‘Infosys Head (HR), Bikramjit Maitra, confirmed the move. He said the reason behind including only a few firms in the ‘named competition’ was to keep the terms reasonable and not restrict employment opportunities available to individuals

The present scenario in the Indian IT setup is such that around 70% of the market is dominated by the companies mentioned in the above list. So, if an employer decides to quit Infosys, his choice of a future employer will be severely restricted. He will have only 30% of the market to choose from. Of course, no one will consider sitting at home of 6 months. In such a scenario, this agreement will be a gross violation of the rights of an employee. It will also make IT companies to concentrate less on being employee friendly. At times like these one wonders if there is indeed a need for a union for IT employees. I seriously hope that voices are raised against such a policy.

Having said all this, my gut feeling is that ET, as usual, has gone overboard and has probably been inaccurate with its story. This thing sounds so ludicrous that it is hard to believe it. Perhaps the article fails to highlight some aspects of the story. Once all the aspects of the proposed contract are known, the story will be clearer.

Hi there!

This post is to assuage any fears of the readers (if there are any left!) that I may have left planet earth! Well, I am here and I am very much alive! I hope that this long hibernating blog will become much more active from now on.