Maybe this was long overdue. Satyam Computer Services Ltd which had been showing tremendous growth in last decade by manipulating its book can no longer afford to do it.
The new owner tech Mahindra can no longer afford to pay people on bench when there are no projects. Satyam said that it is creating a cost-cutting program, which is effective this month, targeting employees who have not been in billable roles for three months or more. Those employees can take up to six months off and receive their basic pay and medical insurance, and may be recalled and reinstated at full pay and benefits as business demand dictates. They can also be called if any situation arises.
This move can effect 5000 to 7000 workers. The news could be bad for tech industry which had been already reeling under US recession . These 7k workers could bring more pressure to salaries of IT professionals in India.
Although this may look pretty bad for now but could be good in long term for the company where it needs to shed its extra flab and grow more comptetive.