The Hindu Business Line : Satyam staff in dilemma as cash crunch fears rise

We are just waiting and afraid of checking our official mailbox as the office gossip is rife with layoff talk. The inside word is that at least 30 per cent of staff would lose their jobs within a week, says a staffer.

G. Naga Sridhar

Hyderabad, Jan. 9 “Should I go to office today or not?” is the dilemma several Satyam employees faced on Friday morning after the interim management said it did not have adequate funds to honour salary commitments for January.

“If we are going to be sacked at the end of the month without being paid, what is the point in going to work now?” asked a company official.

The personnel expenses of Satyam for its 53,000-strong workforce is estimated to be Rs 500 crore a month by the company, which saved the employees from a New Year shock by promptly paying December’s salaries. However, the announcement of Mr Ram Mynampati, the new CEO, on Thursday that the company’s liquidity was in bad shape resulted in fears among the employees that the company might trim workforce immediately to bring down salary outgo.

Email story

There were reports that the company had sent an email it would not pay salaries for two months, which a spokesperson denied.

Reflecting the sentiments inside the IT company, Mr Satya, who has put in 10 years of service in Satyam, told Business Line: “We are just waiting and afraid of checking our official mailbox as the office gossip is rife with layoff talk. The inside word is that at least 30 per cent of staff would lose their jobs within a week.”

Of the 53,000 staffers, 4,000 are contract workers while the remaining are regular, said a company official.

“For all practical purposes, we are jobless now. Instead of wasting time at home, and causing tension to family members, better go and see what happens,” said Mr Rajesh, another employee working at City Centre office of Satyam here.

Salary uncertainty

While perceptions vary, there is consensus among many that their salaries are now at stake. “We don’t know whether the management could enter into any overdraft arrangement with banks having our salary accounts,” Mr Satya said.

When asked whether any overdraft facility was allowed to pay Satyam’s salaries, the officials of HDFC Bank and ICICI Bank – which operate the salary accounts – refused to comment.

“We do have salary accounts and some current accounts of Satyam. We also extended auto loans to some Satyam employees. But we need to protect confidentiality of our customers’ accounts. So no further information can be shared,” a HDFC official told Business Line from Mumbai.

Agreeing that Satyam has a current account with ICICI Bank, an official said the account is not “material”.

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