Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.


Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence


Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
News18 » Business
2-min read

IT Companies Formed Cartel to Keep Entry-level Salary Low: Mohandas Pai

Pai, a former CFO of Infosys, said these companies are taking advantage of "over-supply" of engineers and seeking to command the market, terming this trend "totally wrong".


Updated:December 27, 2017, 8:45 PM IST
IT Companies Formed Cartel to Keep Entry-level Salary Low: Mohandas Pai
File photo of Mohandas Pai.

Hyderabad: Big Indian information technology companies have formed a cartel to keep salary of entry-level engineers low, alleged IT industry veteran T V Mohandas Pai, raising a strong pitch for a better deal for freshers.

He agreed with Infosys Co-founder N R Narayana Murthy, who said that in the last seven years, the salaries of freshers in the software industry have stayed stagnant, while the same for senior-level employees have grown multi-fold.

Pai, a former CFO of Infosys, said these companies are taking advantage of "over-supply" of engineers and seeking to command the market, terming this trend "totally wrong".

"There is a cartel...there has been a cartel, there is no doubt. They (big IT companies) talk to each other, sometimes tell each other not to increase, that's been there for a long time," Pai told PTI.

"I know that people (of big IT companies) used to get together and tell each other not to raise (entry-level) salary. If one took into effect inflation, the remuneration of freshers in the IT industry has in fact come down by 50 per cent in the last seven years," he said.

"That's why attrition in the first five years is very high".

Stagnant entry-level salary has led to bright minds not joining the IT industry, according to him.

"They (big IT companies) can afford to pay better salary. They have to make sure they don't pay more at the top, and they pay more at the bottom. They have to learn to adjust," Pai said.

"To me, it's an ethical, fairness issue; they can afford to pay more. (Not raising entry-level salary is) ethically and morally wrong," Pai said.

He said biggies such as TCS and Infosys should take the lead in giving a better deal for freshers.

"People who are paid low should get more. Best guys don't want to come and join the industry. It's important for them to raise the salary, make sure people at the bottom feel much more comfortable", Pai said.

"It's very depressing (freshers not getting good salary). What to do? Supply is more," Pai said.

"Also, education that they get is not good enough to get them job straight away. They have to be trained."

The IT companies' stand that they spend lakhs of rupees on training freshers is valid, he said, but added that such a scenario has been there for about 20 years now, and it's not a recent phenomenon.

"They should pay more because people need to live properly, they don't get enough money to live," he said.

Unless this is done, Pai warned, big IT companies will end up becoming training ground for other companies, who will not hire freshers and recruit only trained people, so that they can save on training costs.

"It's bad for big IT companies themselves," he said.

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

| Edited by: Ashutosh Tripathi
Read full article
Next Story
Next Story

Also Watch

Most Active
Company Price Change %Gain
BPCL 513.85 4.80
Bajaj Finance 3,965.60 2.22
Reliance 1,370.70 0.48
Infosys 770.90 0.34
ACC 1,540.25 2.82
Company Price Change %Gain
Ajanta Pharma 962.50 0.82
BPCL 513.85 4.81
Indiabulls Hsg 190.95 1.01
MCX India 1,054.00 3.67
Bajaj Finance 3,963.80 2.15
Top Gainers
Company Price Change %Gain
BPCL 513.85 4.80
Zee Entertain 263.15 4.97
Grasim 729.60 3.68
Wipro 249.90 2.57
Bajaj Finance 3,965.60 2.22
Company Price Change %Gain
Bajaj Finance 3,963.80 2.15
ICICI Bank 437.90 1.44
Yes Bank 41.00 0.99
Coal India 193.80 1.31
Bajaj Auto 3,042.50 1.10
Top Losers
Company Price Change %Gain
Adani Ports 404.90 -2.14
Vedanta 151.10 -1.56
Hindalco 189.60 -1.53
Bharti Infratel 254.40 -0.99
Cipla 441.15 -1.21
Company Price Change %Gain
Vedanta 151.10 -1.53
ITC 245.00 -1.01
Power Grid Corp 199.60 -0.87
Maruti Suzuki 6,934.75 -0.76
M&M 581.00 -0.62

Live TV

Countdown To Elections Results
To Assembly Elections 2018 Results