Information Technology (IT) firms are bolstering their efforts to bring down their attrition rate and bring up their employee retention rate. They are doing this by way of perks and cash-based incentives. It makes more sense for them to take this route and put in the extra legwork to retain employees as the alternative of hiring replacements may cost 20 per cent more, according to a Times of India report. One prime example of this trend of going the extra mile can be witnessed in HCL Technologies. This leading IT firm might be bringing back the practice of seating its top performers behind the wheel of a Mercedes-Benz.
This practice was introduced in 2013, where the company allegedly gave out around 50 Mercedes-Benz cars to its top-performing employees. Speaking to the Times of India on the proposal to bring back this practice, HCL CHRO Apparao VV, said that the proposal is now sitting with the board. He said in the report, “Replacement hiring cost is 15-20 per cent 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 went on to add in the report that the company at present has a good retention package with a three-year cash-based incentive scheme which is around 50 to 100 per cent of the annual CTC. Apparao stated that at least 10 per cent of the leadership team has claimed the benefits of this package.
HCL’s attrition rate for the last 12 months (LTM) basis went up by around 11.8 per cent in the June quarter according to the report. This is significantly higher than the 9.9 per cent attrition rate from the previous quarter. Apparao attributed this trend to candidates backing out of job offers on the spot as many of them have multiple offers in hand. “Reneging a job offer is very high today as prospective job-seekers are finding multiple job opportunities,” said Apparao in the report.
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On the other side of the coin, industry giant, Infosys’ voluntary attrition rate came up by 13.9 per cent in the first quarter from the previous 10.9 per cent. It was predicted that this will be the trend in the next few quarters as well, due to high demand, said COO UB Pravin Rao. He said in the report, “There are two factors. One is that growth has come back in a big way after the first quarter. And the second, growth (in jobs) has largely been in India. Our onsite percentage is 24.3 per cent; it was around 27 per cent four quarters ago.”
Even Wipro is not safe from this trend as the attrition rate for the company rose 340 basis points to 15.5 per cent according to reports. As per Wipro CHRO Saurabh Govil, around 10,000 promotions were given during the June quarter compared to the 7,300 the previous turn. Govil stated that the company will be hiring 12,000 freshers this year and put out an additional 30,000 campus offers in the next financial year. In the report, he stated that around 22,000 people will join next year.
Wipro CEO Thierry Delaporte said in the report, “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.