Infosys to hike onsite staff salary, promote up to 9,000

Infosys today said it will promote about 9,000 people and hike salaries of onsite employees by 2-3 per cent in the ongoing quarter.

“We plan to give onsite wage increase of 2-3 per cent in Q4 ... We added 7,500 employees gross this quarter. We are looking at promotions this quarter, 6,000 to 9,000 people,” Infosys CEO and Managing Director S.D. Shibulal told reporters here.

About 24.6 per cent of the total employees are on client sites (onsite), while the remaining 75.4 per cent are offshore employees as on December 31, 2012.

Infosys was the only company among large software services firms which deferred salary hikes earlier in the year citing uncertain business environment. It, however, gave promotions to 20,000 employees.

Most IT companies hike wages in April.

In 2009 too, Infosys had deferred hikes and gave it out in the middle of the year when the business sentiment improved.

During the October-December quarter, Infosys added net 977 employees, taking the total headcount to 1,55,629.

“We maintained margins despite the wage hike averaging six per cent given to offshore employees in Q3. The onsite wage hike will impact our margins by about one per cent in the fourth (January—March) quarter,” Infosys CFO Rajiv Bansal said.

Asked about the hiring plans for 2013-14, Bansal said the company is yet to set any target, but has “made close to 6,000 campus offers“.

Attrition stood at 15.1 per cent (last 12 months basis) in the reported period compared to 15.4 per cent in Q3 2011-12.

Utilisation rates for the quarter stood at 70.1 per cent (including trainees) and 73.2 per cent excluding trainees.

Asked about involuntary attrition at the company, Shibulal declined to give specific details but said “as many as 6,522 people left the company, which includes voluntary and involuntary numbers”.

There was speculation of large-scale layoffs at Infosys affecting nearly 5,000 employees, but Infosys had said it actively asks the “under-performers to seek other jobs” and that such steps are part of normal business routine.

“It is not about letting go of people or voluntary attrition. The fact is that we are a very meritocracy driven organisation and in that we have to let go low performers,” Bansal explained.

“That is a culture, which has been there in the company for many years. So, it is not about voluntary attrition, it is not about asking people to leave, it is about building the right model for the future,” he added.

Shibulal added that Infosys is carrying a bench of about 7-8 per cent more, which is impacting its margins.

“We have adjusted our recruitment based on these factors,” he added.

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