Memorandum Submitted to All Political Parties by ITEC


The Indian Information Technology (IT/ITeS) industry has been one of the most successful sectors in recent economic history of our country. This industry has caught the imagination of a whole generation and has given hope to many as a path to progress. Many parents and their children dream of making a successful career and life in the IT industry. This sector encompasses everything from high-end Research and Development and Software application development to IT enabled services like BPO, KPO and even data-entry operations and customer support operations. Over the last two decades, the IT industry's employment has swelled to more than 25 lakh. The sector is unique as it invariably attracts some of the most highly qualified professionals in India and provides some of the best working conditions. Unfortunately, it is also unique in the way it seeks exemptions from the country's laws – both labour and corporate taxation laws.

Exemption from labour laws is sought by industries who wish to operate with a high degree of flexibility. Exemptions are provided by the Government on the condition that the industry would take responsibility for self-regulation and maintain the highest standards and best practices in its operations and processes. While this in itself offers great manoeuvrability for companies that have to negotiate unpredictable market conditions, it also puts the workers under great risk and pressure. To make matters worse, the situation becomes far more serious when fraudulent companies and individuals start operating under the same umbrella of lax labour laws and take advantage of them to engage in illegal and unethical practices cheating large number of IT job aspirants and professionals.

IT industry has been plagued off late by the menace of employment frauds and career scams. These scams have in various forms, shapes and sizes, including cash-for-job, interview scams, fake offer letters, denial of salaries, shop-shutdowns, false job specifications, recruitment scams, employment bonds etc. Many unsuspecting and helpless job seekers have fallen prey to such unscrupulous elements and organized groups. In the context of high unemployment in the country among educated youth, a large section of job seekers are vulnerable to such frauds. Thus, it becomes utmost important to be vigilant and take stern action against the perpetrators of such crime so that spreading of such activities ITEC has been at the forefront in addressing this upward trend in the number of fraudulent companies which seek to trick students and people in various ways.

Key Concerns

1. Enforcement of Standing Orders Act within the IT Industry
The IT Industry has been enjoying a blanket exemption from Industrial Employment Act (Standing Orders) for a decade now. The Standing Orders would have had the IT Companies define with sufficient precision the employment conditions under them and made these conditions known to their employees. Though the concerned labour department had given ultimatum to the Companies to submit their Standing Order drafts, the responses have been very poor so far.

2. Grievance Resolution mechanism
Several private industries and companies vehemently seek exemptions from labour inspections from various Labour Departments and other authorities. It then becomes a legitimate request that workers in such industries be covered by a separate official authority which can address grievances of workers and launch investigations and prosecutions against illegal and unethical practices. Currently, there is no separate mechanism to enable IT workers to bring their issues to the notice of the relevant authorities.

3. Vigil against Fraud IT firms
Various types of employment and career frauds are happening in the IT industry, including ‘Cash for Job’ scams. Some of the small IT Companies charge money from job aspirants, mostly in the name of training and subsequent permanent jobs with salary and later refuse to pay any salary and the victims end up losing both money and job. Maintaining an active list of people and entities that perpetrate and promote fraudulent activities and practice and making it available for the public will go a long way in preventing repeat of such incidents. A database of such firms and the individuals behind those firms should be maintained by the authorities so that students and employees can avoid being duped into scams.

4. Fresher/Campus Recruitment Policies
The developments following the refusal to onboard Students by certain IT Companies whom they have selected through campus recruitment, have raised concerns among the young graduates who are aspiring to explore their careers in the IT industry. There is an urgent need to formulate certain guidelines for the Industry in this regard. This is essential not only for safe-guarding the careers of the Students but also for upholding the high standards of corporate ethics and business practices

5. Women Cells
The Indian business organizations are still male fiefdoms and the women continue to struggle to break the glass ceilings. IT Companies are no exception. The key challenge for women employees in many organisations is the absence of any formal forums where they could submit their grievances and complaints on sexual harassments and other gender discrimination practices.

6. Contract Labour Policies
Practice of employing workers on contract basis has been on the raise within the IT industry off late. The working conditions for the contract workers, including the wage rates and working hours, are below par compared to their regular counterparts, which is a violation of relevant rules on contract labour. Appropriate rules and guidelines on Contract Labour should be made applicable for the IT Industry.

7. Termination Procedures
Instead of following proper procedures in case of lay-offs/terminations, many Companies follow a practice of forcing employees to submit their resignations. This helps Companies to circumvent any legal compliance requirements, including providing appropriate compensation for the affected employees. There need a mechanism to monitor and address such practices within the Industry.

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