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Restricted stock units can be an effective tool to curb employee attrition and retain key talent
Infosys on Friday said it would raise the salaries of its employees in India by 6-12 per cent while for employees at onsite locations, it would be 1.5-2 per cent, depending on the region.
For employees below the managerial level, the hike in salaries would come into effect from April 1, while for the rest it would be effective from July 1, the country’s second largest information technology (IT) services firm said. Vishal Sikka, chief executive officer and managing director of Infosys, said the hikes were not limited to 12 per cent and would be much higher for star performers.
“We are starting with the process (of appraisal) for our engineers and the (project) leads and they will be based on performance. Majority of them will be in the range of 6 and 12 per cent,” said, Krishnamurthy Shankar, executive vice-president and group head, Human Resource Development, Infosys.
Infosys also said in addition to the hike in compensation, it would roll out restricted stock units (RSUs) to selected employees for which the board and shareholders have already given approval. Though the company is taking a final decision about who the beneficiaries of this scheme would be, senior officials said it would mostly be offered to top performers at the middle-management level and above.
The Infosys board recently gave the company a go ahead to offer RSUs up to 24 million shares (1 per cent) to its employees. Chief operating officer U B Pravin Rao said the scheme would be rolled out in the first quarter of the current financial year and Infosys plans to run it for the next four-five years.
Industry experts say RSUs can be an effective tool to curb employee attrition and retain key talent.
In the three months to March, headcount grew by just 661 - a marked slowdown when compared to the previous quarters. The company, while maintaining that nothing should be read into this, said it was the beginning of the effects higher automation would have on its hiring strategy.
Infosys’ headcount shot up to 194,044 at the end of the last financial year and Sikka said the company was on route to growing to 250,000 by 2020 when the company plans to boost individual employee revenue to $80,000 per year.
The company said it had made over 20,000 offers through its campus recruitment drive this year, with the employees expected to join the company over the next few months. “Lateral hires will be made on a need basis,” Rao added.
