Sixteen employees were sacked and six firms were disbarred by Tata Consultancy Services after the IT major’s investigation into the bribes-for-jobs scandal, the company said in an exchange filing on October 15.
The investigation closure report comes months after the company looked into practices where staffing firms were allegedly involved in bribing senior executives overseeing recruitment processes in the company to get business.
It took action against 19 employees in total — 16 of whom were sacked and three removed from the function.
“Our investigation found 19 employees to be involved and action has been taken against all as detailed here – 16 employees have been separated from the Company for code of conduct violations, and 3 employees have been removed from the Resource Management function,” TCS said in an exchange filing.
It added that six vendor entities, their owners and affiliates have been debarred from doing any business with the company.
The company further said it would continue to enhance its governance measures by regular rotation of personnel performing key roles in the Resource Management function, enhanced analytics on supplier management, periodic declarations by vendors on compliance to the Tata Code of Conduct and know-your-supplier process to cover additional declarations, and vendor management process audits.
The company maintained that it does not involve fraud against the company and there is no financial impact, and that no key managerial person was involved.
In the press conference held after the company announced its second quarter results, Chief Executive Officer K Krithivasan said that the firm had take “appropriate action”.
“We have completed our investigation. We have taken appropriate action against whosoever we believe violated our code of conduct. Actions differ based on the kind of violation but all actions have been taken and it’s closed,” the CEO said.
When asked about what steps the company was taking to ensure this doesn’t happen again during the company’s Q2 earnings conference on October 11, Chief Human Resources Officer Milind Lakkad said the company was looking into organisational, people, process and technological aspects but did not comment on specifics.
Tata Sons N Chandrasekaran had told shareholders at the annual general meeting that he could not quantify what favours they got, but the employees in question “certainly behaved in a way that they were favouring certain firms.”
How it unfolded?
The case first came into light on June 23, 2023, when TCS in its stock exchange filings, following a whistleblower complaint, said that the RMG (Resource Management Group) didn’t handle any recruitment activities for TCS and that it was only responsible for allocation of available resources to various projects and incase of any shortfall, fill such requirements through contractors.
Later during the company’s AGM on June 29, TCS’ chairman N Chandrasekaran had said that the company had already started investigating, sacking six employees and staffing firms.
How TCS works with staffing firms?
Chandrasekaran had detailed that TCS uses two departments for acquiring talent: the HR and talent acquisition, which hires people and the resource allocation group which deploys available resources into projects. In the case of talent shortage or a need for a particular skill that is not available in a location, the company has a set of BA firms (business associate firms or staffing firms) to get contract employees.
“At any point in time in the overall deployment of resources, about 2-3 percent of them are such BAs or contractors. The complaint was related to certain individuals in the company working with certain BA firms to be recruiting in their favour,” Chandrasekaran explained.
He added, “There are a large number of BA firms that TCS works with. There is a rigorous process in the company to recruit or qualify a firm to be called a BA firm. There are about a little over 1,000 such firms globally because we need resources in 55 such countries. And each one of them does a certain amount of business depending on their skill availability.” Moneycontrol