Cognizant offers voluntary separation package to select US employees

COVID-19 jitters has pushed many companies to take tough decisions and the latest to the list is Cognizant Technology Solutions. Sources privy to the developments told CNBC-TV18 that the company has offered employees on bench (a term that refers to employees that are not working on client contracts at present and are not ‘gainfully employed’) a voluntary separation package.

“As the term ‘voluntary’ suggests, employees have an option of taking it. The offer has been made largely to US employees as they are on high payrolls and includes cash and health benefits like long term insurance policies, etc. Complete salary of two months is being offered in the package. For now, the offer has only been made to US-based employees on bench. The company may look at extending that to other employees in onsite (international) locations,” said a source that did not want to be named.

Another executive said the company may look at extending that offer to employees in India as well but that decision has not been finalised, “Almost immediately after COVID-19 pandemic hit, the company has been working to limit the impact on employees. But some clients are asking for furloughs (leave without pay), some are asking for discounts and others have cut spending. The impact will fall then on employees that are working for no projects at present. The package is voluntary so employees have the dignity of choice.”

When contacted Cognizant confirmed that the company is working on a offer for select employees. A Cognizant spokesperson said, “In a people-intensive business like ours, effectively managing workforce utilisation is a key element of aligning our cost structure with revenue. We routinely manage supply and demand with a bench of unutilised employees. We are enhancing our bench policy by offering additional cash and extended health benefits to those who are or will become unutilised and for whom we unfortunately do not foresee future opportunities. As always, we will treat any employees exiting the business with fairness and dignity.”

—CNBC TV18