Winning trust of American employees remains key challenge for Indian IT cos

Despite Indian IT services companies making huge investments in expanding capability for doing local innovation and sourcing of talent in the US market, the allegations that they are biased towards South Asian professionals continues to haunt them. The number of incidents of these disgruntled former employees in the US taking legal recourse against the Indian tech employers alleging discrimination also on the rise.

Last week, Rex Trewin a former global university recruiting manager at Wipro filed an employment discrimination case against the IT major alleging that he was “penalised for stressing the importance of complying with employment laws and regulation.”

The complaint filed with the Colorado district court mentions the company “has engaged in a pattern and practice of systematic termination of its American employees, in favour of Indian employees,” media reports said quoting the lawsuit.

Wipro even though recused itself from commenting on this particular incident pending litigation, the Bengaluru-headquartered company said it would “vigorously defend against these meritless allegations in court.”

“Wipro is committed to the principle of equal employment opportunity and provides all our employees with a work environment that is free from discrimination and harassment of any kind,” said a Wipro spokesperson said in response to queries regarding the lawsuit.

Wipro is not the only Indian IT major facing the heat on the hiring front. Tata Consultancy Services (TCS) is facing a class action lawsuit in California after an American employee alleged discriminatory “termination”. TCS, with almost 30,000 employees, is the largest employer among Indian IT companies in US. Infosys and Cognizant (which had the largest number of H1B approved visas in 2017) are the other companies facing similar lawsuits from disgruntled employees despite spending billions on talent development initiatives in the US.

Last week, Wipro announced plans to ramp up the current headcount of 1400 to 2000 over the coming years in Texas. Wipro also launched the Texas Technology Center in Plano, Texas to focus on new technologies, cybersecurity and analytics housing 150 employees at present. In March last year, the company expanded the Wipro Science Education Fellowship (SEF) program to Texas, in collaboration with the University of North Texas at Dallas and hired over 120 graduates from local universities.

Other Indian IT majors such as Infosys, TCS, and others are also embarked on a significant expansion and hiring in the US ramping up their teams hiring more locals.

Industry watchers, however, dismiss discrimination concerns pointing out that there is a serious dearth of technical skills for IT based jobs in US. By 2020, the US is expected to have 1.4 million more software development jobs than applicants to fill those.

“Traditionally almost 70 per cent of the employee base used to be in offshore locations (for Indian IT companies). It takes about three to five years to bring about a change in the model,” said Navnit Singh, Chairman and Regional Managing Director Korn Ferry (India).

He added that the IT companies are spending enough on reskilling and improving the talent mix but engineering has not traditionally been a top career option in the region. So it will take time to skill and recruit enough people for relevant positions in these organizations.

With the H1B visa filing process starting from 2nd April, companies are expecting stringent scrutiny of applications as the Trump administration clamps down on foreign workers.

Indian IT giants have gone out of their way through outreach programs with local universities, schools, and research centers to boost local hiring. Yet, the Trump administration has continued pushing for a check on H1B applicants to encourage “Buy American and Hire American” policies.

“Indian it companies have been adopting newer technologies and delivery models like cloud artificial intelligence etc. and hence the dependency on H1b visas are reducing. However, while the Indian IT companies would face some difficulties in the short term, they will be able to deal with this as they are also increasing acquisitions and local talent hiring in the country,” said Raja Lahiri, Partner, Grant Thornton India.