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Indian companies, typically in the information technology (IT) services sector, are "silently sacking" or "quietly firing" employees, according to an association, referring to unfavourable conditions that compel people to resign on their own.
The tactic helps companies cut costs by avoiding severance packages for resigning employees and it intentionally creates a deteriorating work environment—such as through overwork, stalled promotions, and lack of support.
The Harvard Business Review said layoffs are a significant expense for companies that have to provide severance packages when they lay off employees. Microsoft incurred a $1.2 billion expense due to layoffs and other restructuring efforts in its second-quarter earnings last year.
A study by US think tank Pew Research Centre found that most workers who quit their jobs in 2021 did so due to low pay, lack of growth opportunities, or feeling disrespected.
‘Quiet firings’ catching up in India
This trend is also catching up in India. According to the All India IT & ITeS Employees' Union (AIITEU), around 20,000 tech employees lost their jobs in "silent" layoffs in the IT/ITeS sector in 2023, Moneycontrol.com reported. These layoffs affected IT services companies of all sizes.
Companies lay off people depending on business conditions. Teradata, a San Diego-headquartered cloud analytics and data platform company, laid off about 35-40 employees at its Hyderabad campus at the end of last year, after previously letting go of around 1,100 employees globally in 2022. Teradata has over 10,000 employees globally, according to LinkedIn.
Boston-headquartered financial services company State Street took over joint venture partner Atos Syntel’s operations in India last year. Moneycontrol reported that around 400-500 employees were laid off in India in March 2024 as part of streamlining operations.
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In 2024 alone, approximately 2,000-3,000 professionals have lost their jobs among the top Indian IT services companies, according to the Nascent Information Technology Employees Senate (NITES).
Citing multiple sources, Moneycontrol said Infosys laid off nearly 200-500 employees across campuses in 2024 by asking many of them to resign voluntarily. Infosys and Atos Group denied the reports.
What are the signs of ‘quiet firing’
Employees may find themselves operating under new policies or expected to take on new responsibilities, their jobs slowly transforming into something that’s further and further from what they signed up for, until resigning feels like the only option.
According to ‘Harvard Business Review’, quiet firing can be identified through various warning signs, particularly in changes related to work responsibilities, compensation, working conditions, and supervisor communication. When an employer is engaging in quiet firing, they might reassign important job responsibilities to other employees, demote an employee, or alter their job description.
The affected employees may also find themselves not being assigned promising new opportunities or being set up with unreasonable performance targets. In some cases, they might be given responsibilities that are undesirable or misaligned with their role, or they may be prevented from receiving a well-deserved promotion.
In terms of compensation, quiet firing tactics can include pay cuts, preventing the employee from earning more by taking on extra work or overtime, or not providing the expected yearly bonuses or raises. Changes in working conditions can also be a sign of quiet firing. This might involve altering work hours or regular shifts, increasing workloads to unmanageable levels, forcing an employee to relocate, or taking away perks such as an office or parking spot.
Communication with supervisors is another critical area where signs of quiet firing can appear. An employee might find that their career trajectory is no longer being discussed, or that they are not receiving performance feedback.
Unfair evaluations and 'ghosting'
Evaluations may become unfair, with excessively harsh feedback or constant criticism of their work. The employee might experience “ghosting,” where meetings are repeatedly cancelled, or they may not be provided with critical information related to their work and responsibilities.
Furthermore, their contributions may not be acknowledged, or worse, credit for their work might be given to others. These warning signs collectively point to a strategy of quiet firing, which can undermine an employee’s position and encourage them to leave voluntarily.
Experts said that Indian heritage IT services providers have altered their operating models to ensure every technical employee becomes a billable resource. A billable resource refers to an employee who is assigned to a project for which a client is billed for their work. And for those who aren’t profitable assets, the companies are finding ways of saving costs without attracting attention.
