The tech sector has been ridden with turmoil this year. The high-paying industry, known for its exemplary HR practices, has been under the radar with the economy (protectionist policies in the developed markets and automation) creating instability, leading to job losses.
Could job insecurity trigger the rise of employee unions in this white-collared sphere, a la manufacturing?
“The recent job losses are too early to solidify into structured unions. But it is making employees join hands to find remedial (and legal) courses for the challenges. One cannot completely rule out union formation in the future,” says Suresh Kodoor, a senior technocrat in IT. He says that employees could increasingly look to align and approach the labour court or seek help from the IT minister or the labour commissioner into the scene. The Forum for IT Employees (FITE), working to be India’s first IT workers union, has been approaching labour offices in light of the recent layoffs.
But formalised union formation in IT is still a long shot, says Madhu Damodaran, co-founder, Simpliance, a firm which assists businesses to be legally compliant.
Experts say unlike manufacturing, where employee unions thrive, in IT the union concept is not quite possible owing to multiple factors. “In IT it is not easy to fight in unity as the professionals are individualistic. They may not necessarily fight for others’ causes,” says T Muralidharan, chairman of talent management firm TMI Group.
In manufacturing as people work for decades in the same company they have collective interests, something that is missing in IT, where jumping jobs is common, says Kodoor. “Wages has been the biggest rallying factor for the existence of employee unions. In IT the issue is not really wages but job insecurity. Also, a little noise can lead to terminations or might create barriers in a candidate’s future job hunts. This doesn’t happen in manufacturing where termination is tough and job jumping doesn’t quite exist,” adds Kodoor.
Agrees Damodaran, who says that being part of a union would be a negative point for an IT employee aspiring for a next level job. “So even if he/she loses a job, the IT employee would resist the temptation of joining a union as that will hinder his/her future job prospects.”
The industry has reacted strongly to the unrest; with Nasscom warning that heightened employee activism can impact the industry and employees negatively, owing to a decline in competitiveness.
HR experts say if at all a union takes formal shape companies will not be able to handle it. “Till now, the HR departments of IT companies were handling individual employees one at a time. If unions emerge, the industry will have to learn to handle a collective workforce,” says Muralidharan.
In the event of unionisation picking up, “the first challenge the IT sector will face is the need for talent to manage the unions,” says Damodaran.
Blessing in disguise
However, unions could perhaps be a secret blessing to the industry. “Imagine a situation where unions negotiate settlements and employers can bargain for a grade-wise scale applicable for all employees at the same level? For employees, it might protect them from arbitrary terminations. This, however, needs to be evaluated as work stoppage can impact deliverables,” says Damodaran.
...& ANALYSIS
- If at all a union takes formal shape companies will not be able to handle it
- First challenge for IT sector will be the need for talent to manage unions
- However, unions could perhaps be a secret blessing to the industry
