Nasscom seeks government's help for benched staff

It has also asked the government to introduce a furlough scheme, like in the UK, where for the period of lockdown, employees can remain with the company, but not take a salary.

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BENGALURU: IT industry body Nasscom is seeking a financial package from the government to save the jobs of employees in business process management (BPM) firms and global in-house centres (GICs) who no longer have any work.

Nasscom has suggested that benched employees be paid only minimum wages along with statutory entitlements. It has also asked the government to introduce a furlough scheme, like in the UK, where for the period of lockdown, employees can remain with the company, but not take a salary.

“During that period, the government pays 50% of the employees’ salary and during that period the accruals of the employee also ceases,” Nasscom said. It has asked the government also to bear the PF contributions of a certain section of employees and companies for the next three months.


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This, it said, is required immediately to prevent job losses after April 15. “BPM/ GIC and parts of the IT Industry are operating at max 70% capacity utilisation. Assuming 20% of the industry is idling at home, that’s a very large number. Salary costs would be huge,” Nasscom said in response to a TOI query on its demand from the government.

The IT/BPM industry has over 4 million employees. Of these, about a million are in the BPM segment — the one which provides finance, accounting, payroll, procurement, HR, supply chain, legal and other services to global and domestic companies. Many of the GICs do similar services work for their parent companies and their customers. As business around the world collapses, the demand for such services has also fallen.
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A back of the envelope calculation based on Nasscom data shows if one leaves out larger firms, there would be some 4 lakh employees who would be vulnerable and a majority of them would have a basic pay of about Rs 12,000 a month. This would mean the government and the industry would have to chip in with a Rs 480-crore package.
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