India's largest software exporter TCS is planning to sack 172 employees at its Finland offices by August as part of the process to streamline its operations.
New Delhi: India's largest software exporter TCS is planning to sack 172 employees at its Finland offices by August as part of the process to streamline its operations.
Perturbed by the development, Finnish workers have alleged the move by the company is an attempt to maximise profits at the expense of employee rights.
Tata Consultancy Services (TCS) has a registered office in Helsinki and has an employee strength of about 800 in Finland. It had started talks with employee representatives in April 23 this year on layoffs.
The negotiations were concluded earlier this month and the firm said that at present 172 employees with Finnish contracts can either take a severance package or apply for redeployment opportunities across TCS.
"After staffing of the new organisation, currently there are 172 employees with Finnish contracts who are eligible for taking the industry-standard severance package offered or to choose the option of applying for redeployment opportunities across TCS," a TCS spokesperson said.
Juha-Matti Heikkinen, the employee representative at Salo in Finaland, told PTI that TCS Finland employee consultations have ended.
While TCS did not comment on the time-frame of layoffs, Heikkinen said the people who will lose their jobs now have until June-end to decide if they resign themselves and take a voluntary severance package. If they choose not to take it, they will be made redundant on August 16, 2013 and their official notice period will then start.
In April, over 160 employees at the Finland offices of TCS had staged a walkout protesting job cuts. These employees were outsourced by Nokia to TCS in March. The employees are based in Espoo, Salo, Tampere and Oulu.
When the consultations started in April, there were 447 ex-Nokia employees working for TCS. They all work under a Finnish employment contract.
"TCS has officially communicated that 172 people with Finnish contracts will lose their jobs. On top of this, there are 50 or so people who mostly resigned during the very arduous consultation process and a few who are on medical or parental leave and do not have a nominated position when they return," Heikkinen said.
Comprehensive support structure offered includes options for out-placement services and counselling, the spokesperson said.
"We have requested the Finnish trade unions and the government authorities to investigate the status quo and block any loopholes in the Finnish work visa system that, in the opinion of our constituents, now exist and enable companies to easily lay off and replace local talent with people with foreign employment contracts," Heikkinen said.
He further added that the Finnish employees have nothing against Indian IT professionals working in Finland.
"Finland and the Finnish people welcome them. However, it is not ok for any company that operates in Finland to lay local people off permanently and at the same time bring people here to do their work on a foreign work contract," he added.
TCS is able to send these Indian expatriates (and their families) back to India on a month's notice if they so desire, Heikkinen said.
"So the expatriates are not enjoying the benefits and rights of the Finnish employment system to the fullest. This is simply TCS maximising its profits at the expense of their employee rights," he added.
On the issue of TCS employees approaching the unions, Union of Professional Engineers in Finland (UIL) Director (Collective Bargaining) Ismo Kokko said that the unions have been approached by the employees.
"Yes, we have started to work this issue with both Ministry of Labor and Foreign Affairs. Hopefully we are able to influence the Visa appliances and administrative practices so that these kind of operations are no longer possible," Kokko said.
On the same issue TCS Finland Country Head Ruchikar Dalela said: "We greatly value the talent and expertise of our Finnish employees and have been collaborating with the employees and their representatives to save every position that is possible."
Dalela further added: "It is now our priority that the impacted employees are provided with all relevant opportunities within the organisation through redeployment. We will also offer a severance package which is aligned to the benchmark for the Finnish IT industry."
For example, senior employees will receive up to 12 months of base pay in addition to other components, he said.
"The voluntary severance package is a common practice in the IT sector in Finland and the size of the package depends on years of service and salary. The size of the package is on the same level as the packages that for example Nokia has offered this year," he added.
Some sources privy to TCS management's thinking said the company has saved over a hundred jobs and with the talks still on with the management the number can come down further.