Info-tech

IT employees’ union writes to Centre against Infosys, seeks removal of non-compete clause

BL Bengaluru Bureau | | Updated on: Apr 20, 2022

FILE PHOTO: An employee walks past a signage board in the Infosys campus at the Electronics City IT district in Bangalore, February 28, 2012. REUTERS/Vivek Prakash/File Photo | Photo Credit: VIVEK PRAKASH

It is standard business practice for employment contracts to include controls of reasonable scope and duration to protect confidentiality of information, says Infosys

A trade union representing workers in the IT-ITeS (Information Technology and Enabled Services) sector has written to the union labour ministry requesting that certain non-compete clauses in Infosys employee contracts be removed.

The Bengaluru-headquartered IT major Infosys had recently asked employees to agree to a clause, that prohibits them from working for the same customer with rival firms, till six months after leaving the company. The competing firms named in the clause include Accenture, TCS, IBM, Wipro and Coginzant. It also prohibits them from working for the same customers they served at Infosys in the previous 12 months.

Harpreet Singh Saluja, President of the Nascent Information Technology Employees Senate (NITES), told BusinessLine that the clauses violate Indian labour laws and are discriminatory.

“We decided to approach the Centre for help after receiving multiple complaints from Infosys employees that these clauses are illegal and violate of section 27 of the Contract Act.” Stating that while labour laws fall under the concurrent list and are thus largely enforced by State governments, Saluja, however said ‘for organisations which have a multi-State presence, it is better if the Centre directs States to protect employee rights.”

Attrition

The $227 billion Indian IT industry – including $178 billion in exports – directly employs more than 4.5 million people in the IT services and Business Process Management (BPM) industry. While the pandemic has provided a business boost to IT companies operating out of India as more businesses either moved or did more online, it also resulted in higher demand for skilled workers, leading to an increase in attrition. In the last twelve months, Infosys has suffered a 27.7 percent attrition.

Infosys however in a statement said, “It is standard business practice in many parts of the world for employment contracts to include controls of reasonable scope and duration to protect confidentiality of information, customer connection, and other legitimate business interests. These are fully disclosed to all job aspirants before they decide to join Infosys, and do not have the effect of preventing employees from joining other organisations for career growth and aspirations.”

However NITES said that Infosys is not alone in enforcing such clauses and other companies too have various other ‘anti-employee measures.’ Saluja said that his organisation would continue to fight ‘harsh, oppressive and illegal, anti-employee measures of technology companies.’

Published on April 20, 2022
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