Tech Mahindra’s Gurnani earned most, but Wipro’s Neemuchwala took home more

Gurnani earned Rs 1.46 billion in 2017-18, which is 3,150 times the median employee remuneration (MRE) at the company

 

While Tech Mahindra Chief Executive Officer CP Gurnani continues to earn the highest remuneration among IT giants, in gross salary terms most CEOs took home a modest package led by Wipro’s Abidali Neemuchwala.

Gurnani earned Rs 1.46 billion in 2017-18, which is 3,150 times the median employee remuneration (MRE) at the company. However, Gurnani’s remuneration consisted of Rs 1.42 billion in stock options granted to him in 2013 and exercised during the current financial year.

His actual gross salary component was Rs 27.7 million. In fact, Gurnani’s total earning in FY18 declined by 3 per cent compared to the previous year while his actual salary (minus earning from the stock options) grew almost 10 per cent.

During the same period, vice chairman Vineet Nayyar’s remuneration jumped 101 per cent to Rs 401 million. The percentage increase in MRE for Tech Mahindra employees in FY18 was 9.19 per cent, while the fiscal year itself saw the company shedding headcount by a little less than 5,000.

“An increase of 0.22 per cent was given to employees during the year under review. There was an increase of 8 per cent in the remuneration of managerial personnel mainly on account of exercise of stock options granted earlier,” the company said in its annual report.(TECH MAHINDRA SHARE PRICE )

Neemuchwala on the other hand took home Rs 182.3 million during the same period, of which Rs 63 million consisted of gross salary and a little more than Rs 100 million was in the form of stock options. His remuneration which is almost 338 times of the MRE, increased by 34.5 per cent during the year. The MRE of employees across the company increased 3.25 per cent during the financial year from Rs 5,23,000 to Rs 5,40,000.

Even Salil Parekh, who took over as Infosys CEO in the final quarter of the last financial year, earned almost Rs 40 million, 273 times the MRE at the company. His predecessor, Vishal Sikka, earned almost Rs 130 million, of which Rs 60 million was the gross salary before he resigned in August last year. Parekh’s earnings did not include the hefty stock options bestowed upon Sikka. The MRE for Infosys increased six per cent during the year.

TCS has maintained the lowest CEO MRE ratio of 212 with Chief Executive Officer Rajesh Gopinathan taking home Rs 125 million during the year. His gross salary component is the lowest among his peers at Rs 16.24 million. The rather modest earnings also reflect in the mere 0.57 per cent increase in MRE for TCS employees during 2017-18.

While HCL’s annual compensation numbers are not out yet, 2016-17 witnessed a five per cent rise in MRE. The overall slowdown in headcount has helped companies protect margins to some extent. According to estimates by JP Morgan researchers, reduction in employee expense accounted for almost 35- 40 per cent margin gain for Tech Mahindra between December 2016-17 and December 2017-18.

“Companies will need to get other structural margin levers to operate more strongly, given that utilisation may need to moderate from the current peak (85 per cent ex- trainees) and can no longer be relied upon to drive margins,” according to the JP Morgan report released last month.

News Source : BS 

Pink slips galore: Wipro, Infosys, Tech Mahindra, Cognizant cut India jobs

Tech Mahindra recently fired close to 1,000 employees; Wipro was the canary in the coal mine

 

Once India's global claim to fame, the country's information technology (IT) sector is seeing a spate of layoffs by IT majors like Tech Mahindra, Wipro, Infosys and Cognizant. 

The churn in the IT sector — which is moving towards increasing automation, use of artificial intelligence and is beset by tightening visa regulations — is likely to affect mid-level employees with 10-15 years of experience the most, as many are averse to learning new skills, industry experts have said.

Further, Indian IT firms are witnessing their slowest growth in a decade, while global firms are shifting their budgets from traditional IT services to newer areas such as digital and cloud, which require engineers to engage with clients instead of working remotely. Even as this shift takes hold of the sector, automation is increasingly taking over low-end maintenance work, forcing companies to shift workers to other projects and reduce hiring from campuses. 

Tech Mahindra joins the bandwagon

As reported earlier, software services firm Tech Mahindra has sacked a thousand-odd employees this month. 

However, what happened at Tech Mahindra is not an outlier, other IT majors like Wipro, Cognizant, Infosys and Capgemini are also facing their own share of challenges, and moving to either prune or re-skill their respective workforce. 

“We have a process of weeding out bottom performers every year and this year is no different,” a Tech Mahindra spokesperson said.

As on December 31, 2016, the company’s total employee headcount stood at 117,095, while the software division had 80,858 employees. 

Wipro was the canary in the coal mine

Late in April, Wipro move to sack around 500 of its employees as part of its appraisal process. (Read more) 

The company is reported to have weeded out "non-performers" after a "rigorous performance appraisal". 

While Wipro did not specify the exact number of affected employees, the company said it “undertakes a rigorous performance appraisal process on a regular basis to align its workforce with the business objectives, strategic priorities of the organisation, and requirements of our clients”.

“This systematic and comprehensive performance evaluation process triggers a series of actions, such as mentoring, retraining and up-skilling. The performance appraisal may also lead to the separation of some employees from the company and these numbers vary from year to year,” it said. (READ MORE)