Is Tech Mahindra Practicing Unethical Layoff Process to Optimise Cost? [UPDATED]

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A person is known by his behaviour and approach during the tough time. Looks like the same is very much applicable for companies as well. In a recent incident, one of the leading IT companies in India, Tech Mahindra, is caught red-handed by practising unethical layoff process in the name of cost optimisation.

An employee of Tech Mahindra, who served the company for three and a half years, was shown door mercilessly as a result of the cost optimisation initiative taken by the company. He was asked to resign almost immediately without being given any prior notice. The recorded telephone conversation between the guy and the female HR executive clearly indicates that, despite being on the wrong side, Tech Mahindra shows no value to their employees’ request.

Shockingly, the female HR executive of Tech Mahindra even insulted the injury by threatening him to slap a termination letter if he fails to resign by the end of the very same day. She informed that the management of the company has already taken the decision to fire other associates as well in the similar fashion, who may receive the call soon.

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“Cost optimisation is happening at the company and your name is part of that list. If you can put in papers we will be treating it as a normal exit with June 15 as last working day, if not, we will be sending you a termination letter,” the HR executive said.

The employee, shocked and stunned, can be heard requesting for some time repeatedly. However, the unfazed female HR executive bluntly told him that she must follow the orders from her higher authorities. She even accused the employee only for accepting the offer letter having the clause of ‘immediate termination‘.

It is not the first time when Tech Mahindra has decided to employ such unethical layoff process. The company has been practising it for a very long time. A former employee of Tech Mahindra, who spoke to Dazeinfo on the condition of anonymity, recalled her ordeal one morning when she was barred from entering the office. She had to go through a great degree of embarrassment as she was asked to hand over all company’s asset to the security guard. Her employer, Tech Mahindra, never gave her a clue about the decision before that morning. She also told us that there are many former employees of Tech Mahindra who were fired from the company all of sudden without any prior notice. Though she later received a month salary as compensation, there were many who were neither allowed to serve any notice period nor compensated for that.

Employee Termination: How Ethical is It?

Let’s be clear, termination of an employee without having any serious charges against him/her is not only unethical but also illegal. Some of you may not find Tech Mahindra on the absolute wrong side stating that the employee agreed to the clause of immediate termination while accepting the job offer. Let me tell you, a company can’t pen any termination clause in an offer letter at all.

Besides, termination from a job must be practised only in the case of very serious charges, likes of harassment, property damage, against any employee, say HR experts. In a case of any corporate restructuring or strategic planning, an employer is must be notified well in advance, and this is applicable for employer and employee both.

We also spoke to few corporate lawyers who say that any agreement on the company letterhead, but not certified by the notary, doesn’t hold any ground in the court. Most of the companies don’t attest the offer or employment letter intentionally as it will bind them also to abide by the law. However, employees try to refrain from approaching a court to attract unnecessary attraction which may hamper their professional life.

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In 2015, another Indian IT company, Tata Consultancy Service (TCS) tried to employ similar practice only to regret later. The terminated employees dragged TCS to court against their termination. Later, the court ruled in the favour of employees by putting a stay on their termination.

UPDATE: Taking the cognizance of the matter Anand Mahindra, Chairman – Mahindra Group, tweeted his apology on the matter. He also assured that the similar incident wouldn’t be repeated in the future.

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