Diversity Under Lens As IT Faces Fresh Suits In US

Indian IT services companies Wipro, Infosys and HCL Technologies have faced fresh lawsuits on employee discrimination in the US last month at a time when these firms are seeing an increased hostility for visas in their largest export market.

In December, Wipro received a lawsuit over allegations of racial discrimination by an African-American employee named Kevin Clark. He has alleged that he was not given projects and ultimately terminated based on his race. While Clark sought damages for emotional pain and distress, he has also demanded a compensation of $25 million and other costs.

The same month, India’s second largest software services exporter Infosys received a lawsuit from Cathy Szczepinski in Ohio for alleged violation of fair labour standards and denial of overtime payment. Whereas, HCL Technologies received a lawsuit over allegations of discrimination by an employee named Sierra Claytor based in North Carolina.

“Wipro is committed to being an equal opportunity employer and the employment policy adheres to the highest standards of integrity, fairness and ethical corporate practices. The company does not comment on pending litigation,” said a Wipro spokesperson.

Infosys and HCL Technologies did not respond to ET’s queries until press time. Indian companies have been increasingly facing restrictions in getting the coveted H-1B visas due to the Donald Trump administration’s decision to favour US technology companies for work permits. This has made Indian tech services companies increase hiring local workers in the US.

With increasing number of clients demanding digital technology-led services, Indian tech services players are pushed to deploy more local employees to work with clients.

In October, Infosys faced a class action suit from an investor as the company’s ADS fell 12% following a whistleblower’s allegations of accounting malfeasance. Analysts said the “lawsuits and the cost to settle these claims will not materially hurt these firms” but the lack of diversity both on race and gender could impact these firms to some extent. “The Indian service providers are in a very tough spot.

All of them have adjusted their personal policies to accommodate US and EU expectations. They have trained their managers in US and EU techniques and have instituted industry best practice procedures regarding HR and anti-discrimination. Having said all that, their US and EU organisations suffer from a significant lack of diversity both from an ethnic and gender perspective,” said Peter Bendor-Samuel, CEO at Everest Group, an IT advisory and research firm.―Newsfeed