Bengaluru: Tata Consultancy Services(TCS) has invested over $100 million in building talent in the US and has created 17,000 US jobs between 2011 and 2017, which helped convince a California jury that it had no motivation to discriminate against locals, a senior executive told ET.
The trial strategy could be replicated by other Indian IT companies that are facing similar suits by the same legal firm that sued TCS.
“There were two stories about us in the US — one was our growth story and other was the litigation story. At some point, the litigation started overshadowing the other story. Now that overhang has gone,” Vish Iyer, vice-president, TCS, said. Iyer said TCS had invested $100 million in creating and building local talent and had created over 17,000 jobs in the US from 2011 to 2017.
Iyer, who was in court for the week-long trial, along with TCS president Surya Kant, said the company convinced the jury that it had strong processes when it came to hiring and firing. Iyer said that hiring decisions are taken by a client partner and the customer and that firing decisions go through multiple levels.
“We have a very detailed termination recommendation report, which is first sent by the resource management group/the demand supply group to explain what all steps are taken to get this person deployed and why the deployment has not taken place. The HR partner goes through that and talks to the individual, other people, a few client partners and so on and satisfies themselves. Then it comes to the legal department where the employment lawyer reviews it.
He or she can push back if they don’t see evidence.” Iyer said. “Then it goes to the deputy head of HR who alone can approve a termination.” The company also analysed 1,000 terminations and found multiple reasons for which a termination could occur — client escalations, misbehaviour, code of conduct violations, job abandonment, etc.
Iyer said the statistical analysis done by the workers’ counsel had not controlled for terminations for non-discriminatory reasons. Iyer said TCS’ own analysis showed that involuntary termination among non-South Asians was over 7%, compared to over 25% for workers in similar project-based workplaces.
But fighting these cases, with teams of lawyers and months of depositions, discovery and expert witnesses, does not come cheap. “I can’t reveal how much we spent to defend the case; it is a significant number but we also have insurance,” Iyer told ET. He added that to have settled in the case like this meant there could have been a negative connotation.
“We have operated for 40 years in the country and we have a very strong internal legal team, we know how to handle this process. If there are some individual cases, sometimes people sue for $3,000 or $5,000. Then you just settle it and move on, don’t waste time. But this is was about a principle so you can’t afford not to fight,” Iyer said.
