The Hindu Business Line : Infosys' non-compete bond `to protect intellectual property'

Chennai June 12 Contrary to reports about Infosys Technologies' recent introduction of a non-compete bond for employees being perceived as a forceful way to retain talent, Mr T.V. Mohandas Pai, Director - Human Resources and board member, Infosys, said, "the bond is a measure to protect intellectual property (IP) and not an anti-poaching measure to control attrition."

Mr Pai told Business Line that the company had introduced the bond for all employees only as a natural extension of the confidentiality agreements it signed with clients. "When we sign up clients, our agreements also include a range of confidentiality measures, including IP. When an employee leaves our company to join a competitor to work for the same client, he is bound to use our templates and techniques. This results in IP moving out of Infosys to the competitor as well as a breach of confidentiality," he said.

When asked if it was necessary to extend the non-compete bond to entry-level employees, he said yes. "They (entry level employees) are also trained on our methodologies and use our templates. They use these to work for clients." He added that the six-month period restraining employees from joining competitors was "not too long" and that senior management employees would have a "more onerous clause" perhaps, extending this period to up to two years.

How will Infosys track employees to see who breaks the bond? "It is easy and we would not need to deploy any additional resources," Mr Pai said without elaborating. "Moreover, breaking the bond would reflect poorly on the employee's credibility and no company would feel confident hiring such a candidate," he said, reflecting the opinion of some industry majors who had told Business Line they would not hire candidates without due diligence.

When asked how many employees had signed the non-compete bond so far, Mr Pai said he did not have the data.

More Stories on : Human Resources | IPR | Software | Infosys Technologies Ltd

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