This is expected to benefit subcontractor firms such as Manpower Group, Randstad, Adecco, Kelly Services, Allegis Global Solutions and a host of other boutique staffing firms which supply skilled manpower to technology companies in the US.
According to outsourcing advisors and experts, while almost half of the deals are likely to see delay, the others are expected to be renewed at a lower price as enterprises ask for discounts in roll-over contracts.
Thierry Delaporte's pay package would be around 34 per cent higher than the total compensation that Wipro CEO Abidali Neemuchwala received in financial year 2019-20 (FY20). It also brings the Wipro CEO's salary on par with other top IT firms such as Infosys and Cognizant.
The lockdown that crippled the entire logistics, delivery and supply chain network to near zero, was enough to deal a body blow to India's fastest growing unicorn whose very business model saw a severe disruption, like several other firms and sectors.
The IT firm will soon initiate discussions with colleges to start the process from September.
As enterprises halt ongoing projects or cancel them, all staffers working on such projects are placed on the bench. In some cases, IT firms have to reduce billable staffers in a project as clients ask for scaling down support, leading to rise in reserved employees.
Bhattacharya is now more optimistic than before regarding the adoption of newer technologies, even though she acknowledges there could be short-term challenges owing to the pandemic. Salesforce is among the first global employers to take the 'no lay-off' pledge, pertaining to COVID-19.
'If the business doesn't recover in next 6-10 months, there might be situation where there would be some lay-offs...That may be required for survival and to ensure livelihood to millions of people.'
According to several industry sources in the know, expenses towards deploying contractual staffer, which used to account 10 per cent of the overall billable employee cost at IT firms, has fallen to around 3 per cent. IT firms typically use the contractual workers from staffing solutions providers or subcontractors.
'Now, because of COVID-19, we have become the only way to learn.'
Top Indian IT firms, such as TCS, Infosys, and Wipro, have signalled taking aggressive cost take-out measures, including reduction in sub-contracting costs, travel expenses, freeze in salary hikes, and holding back variable payments, among others.
'When a person is capable of infecting 50 others, will you think about the privacy of the person or about protecting the lives of people?'
Top Indian IT services companies - TCS, Infosys, Wipro and HCL Tech - have said that they would continue to hire freshers through campus interviews, though lateral hiring will be mostly on exception basis.
However, the company says it will suspended promotions and salary increments this year.
While industry leaders Tata Consultancy Services and Wipro have announced deferring wage-hike plans, other players such as Infosys and HCL Technologies are expected to follow suit, according to industry insiders.
In the mid-tier space, clients with weak balance sheets are likely to ask for price revision apart from delay in payment.
While Wipro will announce its fourth quarter (Q4) results along with annual financial statements on April 15, market leader TCS will hold its board meet the next day (April 16) for approval of its financial statements. Infosys is yet to inform investors the date it will announce its Q4 earnings.
What is aggravating the situation is that e-commerce firms are facing huge shortage of delivery personnel. They have not been able to bring back their staff to work, despite offering higher pay and Covid-related insurance packages.
Though there have been no cancellations of contracts by invoking the force majeure clause, a number of clients - especially in the worst-affected sectors like travel and hospitality, oil and gas, as well as manufacturing - have started asking for reducing level of IT support.
Though a weak dollar will lend some support to revenues and margins in FY21, the demand environment will outweigh any gain.
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