More Indian IT firms may follow Infosys 'gig work' stance

Infosys, last week, decided to allow employees to take up gig work with prior approval

More Indian IT firms could follow in the steps of Infosys and allow their workers to take up "gig work" outside the company with prior approval in an effort to stem the tide of widespread moonlighting affecting the $227 billion IT outsourcing industry.

Human resource experts and industry executives spoke to The Economic Times and many top executives at staffing firms are of the opinion that allowing employees to work for non-competing organisations, even with prior approval, could lead to managerial disruption rather than enthusing IT workers. They noted that attrition-addled companies are not likely to largely benefit from this since only a small percentage of the workforce is likely to go for such a scheme.

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Top firms like Wipro, which sacked around 300 employees who were found working for multiple firms, have been vocal against moonlighting. Infosys took a hard stance too, as announced during the second quarter earnings, but management did not specify how many people were let go.

T V Mohandas Pai, former CFO and board member at Infosys and founder of Aarin Capital expressed approval of Infosys' decision — taken last week — to permit "gig work with prior approval". He said, "These policies (allowing gig work with prior approval) are sensible and empowering, and protect the interests of the employees. All companies should come forward and open up to such progressive policies".

The Bengaluru-based firm, however, added "care needs to be taken to ensure that these projects comply with the company's policy for gig work and do not breach client contracts or impact the employee's ability to be effective in their full-time job with Infosys."

Naysayers believe this new decision will not bring any major shift. Among them is Guruprasad Srinivasan, ED & CEO of staffing firm Quess Corp, who told ET, "I don’t think the (external IT gig) policies will bring any major shifts. IT gigs have always been only a fraction of the workforce. It will never cannibalise or transform into a big chunk of the workforce." He added, "Though such policies will formalise IT gig employment, it (takers) will not exceed more than 5 per cent. There will be no takers in large numbers because not everyone wants to work 16 hours a day." He also noted that humans can only "scientifically" concentrate for 48 hours per week for a "quality outcome".

Staffing firms supplying talent to IT companies noted that workers would prefer leveraging specialist skills while seeking gig work.

"Techies may prefer side gigs on skills they specialise in, which is primarily coding, and that's where they can make additional competitive income," Kamal Karanth, cofounder of specialist staffing firm Xpheno said. He also noted that the onus lies on managers to decide which employees can take up such work.

"This policy will also give too much discretion to the line manager. The managerial staff will have a problem choosing whom to allow for side gigs--whether it’s their racehorses or laggards without impacting their productivity levels," Karnath said, adding, "If the side gigs take off, the managers will be burdened with additional management stress as they are already overloaded with attrition, hiring and upskilling issues in their teams."

Read | Love it or hate it, moonlighting is here to stay

Moonlighting, which refers to taking an additional job apart from the primary work to augment income, has become a hot topic in the IT industry, which has been struggling with attrition problems. The ratio has risen to almost 30 per cent over the last few quarters. Employees with up to four years of experience cashed in on the supply-demand mismatch by switching jobs and asking for steep hikes.

Infosys, India's second-largest software exporter, does not support dual employment, CEO Salil Parekh clarified in a post-earnings conference. "We have found in the past 12 months of the employees who are doing blatant work in two different companies where and there's confidentiality issues, we have let go of them," he said.

The company also noted it has an internal platform, Accelerate, where employees can opt for gig work in other projects within Infosys apart from their primary projects. The platform gets around 4,000 applications every quarter, of which 600 are approved.

Even with company-wide policies supporting gig work, industry analysts do not expect more than 5 per cent of the IT workforce to take up this offer. Employees are not too keen to jump onboard with these policies since they might result in issues with their managers as well.