Top Performers At HCL Can Drive Home A Mercedes-Benz As Incentive

Bengaluru: Because replacing top employees may cost up to 20% more, IT companies are coming up with innovative ways to retain the existing employees by offering them smart benefits and cash-based incentives. Top performers at HCL Technologies, for example, may receive a Mercedes Benz as a reward.

The proposal has been submitted to the board of directors for approval, according to HCL CHRO Apparao VV. In 2013, the firm gave away 50 Mercedes Benz cars to outstanding achievers. However, this practice was eventually terminated.

"Replacement hiring costs are 15-20% higher. Hence, we are actively participating in skilling our workforce. If you need a Java developer, you will get them at the same price point. But a cloud professional can’t be hired at the same price point," he said.

In the current fiscal year, HCL Technologies intends to employ 22,000 freshers, up from 15,600 in the previous year.

"HCL has a good retention package with a three-year cash incentive scheme which is 50-100% of the CTC every year. At least 10% of the critical talent in the leadership teams have benefited from it," he said.

On an LTM (last 12 months) basis, HCL's IT services attrition increased to 11.8 per cent in the June quarter, up from 9.9 per cent in the previous quarter. Indian IT businesses, according to Apparao, are also dealing with individuals declining employment offers.

"Reneging a job offer is very high today as prospective job-seekers are finding multiple job opportunities," he said.

The total employment market, according to TCS CHRO Milind Lakkad, is hot right now.

"So, yes, there will be some impact on attrition. But it is part of our operating model, and we will manage that. I don’t think it will have an impact on any business parameter materially," he said in a recent earnings call.

Voluntary attrition at Infosys increased sequentially from 10.9 per cent to 13.9 per cent in the first quarter, computed on an LTM basis rather than quarterly annualised. According to Infosys COO UB Pravin Rao, attrition will likely remain at this level for the next few quarters due to increasing demand.

"There are two factors. One is that growth has come back in a big way after the first quarter. And second, growth (in jobs) has largely been in India. Our onsite percentage is 24.3%; it was around 27% four quarters ago," he said.

Infosys has launched skill tags, which enable employees to demonstrate their competence in new-age/niche technological areas.

Wipro's voluntary attrition increased by 340 basis points from the previous quarter to 15.5 per cent.

"The dramatic shift to a remote working environment has made labour across all sectors and markets more mobile and liberated. Therefore, higher attrition has become a universal issue," said Thierry Delaporte, CEO of Wipro.

According to Saurabh Govil, CHRO-Wipro, 10,000 promotions were given out in the June quarter, compared to 7,300 the year before.

"We will hire 12,000 freshers this year and make 30,000 campus offers to be onboarded in the next financial year. About 22,000 people will join next year," he said.

Employees are receiving skills-based incentives, according to Govil, and roughly 10,000 of them received them in the June quarter. "It accounts for 10% to 20% of their annual salary." According to him, the bulk of attrition occurs among employees with two to five years of experience.