Nasscom issues guidelines against poaching in IT sector

Thursday, April 29, 2010, 10:11 by Business Editor

Malpractices by HR departments of some IT firms such as poaching through attractive employee referral programs have faced criticism from a Nasscom committee.

The committee for Ethics and Corporate Governance, chaired by Infosys mentor N R Narayana Murthy, said that IT companies sometimes use poaching as a means to meet human resource needs for short term projects. The practice can hurt other companies as whole teams working on a project may leave the firm to join another firm. Around 2.3 billion employees are directly employed in the IT-BPO sector.

The committee suggested adopting methods such as asking a prospective employee for a relieving letter from the previous employer, as a best practice in HR. Employees in IT companies should also serve the company for the entire period of their notice.
Companies often refrain from asking prospective employees for documents of their previous work experience as they hurry to meet manpower needs for short-term projects. Employees from other companies are hired by offering attractive salaries. Companies also attempt to increase their bench strengths by providing high commissions to HR consultants.

The Nasscom committee advised companies to hire employees through unbiased mediums like newspapers, radio, television and websites. President of Nasscom Som Mittal said that such means were proper for companies as they had sufficient time for recruitment before starting a new project.

Other suggestions made by the committee included informing employees headed overseas for assignments about their visa and compensation rights, adopting and following a whistleblower policy and appointment of an ombudsman to look into ethics concerns. It also advised companies to pay its directors a fixed contractual remuneration amount or 3 percent of the net profit as mentioned in the Companies Act, 1956.

The committee which was formed last year following the Satyam scandal, comprised of industry leaders such as CEO and President of GenPact Pramod Bhasin, member of Mastek board Ashank Desai, CEO of Zensar Ganesh Natarajan, former CVC Chairman N Mittal and TCS Vice-Chairman S Ramadorai. ?

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