Syntel bonus paid out
By Ria Sharma

Over the last 15 months, Techgoss had published a series of exclusive reports giving details of all that was happening inside the BPO, KPO and IT divisions of one of India’s most successful IT-ITES companies Syntel.  In November, 2010, Techgoss had published an exclusive article on Syntel KPO offering Retention Bonuses of up to Rs. 1 Lakh to keep their hard working employees.  (Article republished below)

We love our Tipsters! A regular Techgoss Tipster has sent us an update

“
The KPO deferred bonus amounts were as follows

Trainee (E0) - Rs 10000
Associate and Senior Associate (E1 & E2) - Rs 22,000
Team Leader (E3) - Rs 50,000
Manager (E4) - Rs 1,00,000.

All E1 and E2 employees got their final installment (approx Rs. 13,000) in their October, 2011 salary.  For E1 and E2 staff,  the bonus was paid in 2 installments -  40 percent was paid in June, 2011 and the remainder 60 percent in the October, 2011 salary.

FLM and Managers would get this installment in Jan, 2012.
“

(Tipsters, Big thank you for all your tips and photos. Do you have a story to tell? If you need to speak to us in confidence or write for us, email us at techgoss[at]hotmail. Or use the Anonymous Tip form at the top of our website. Anonymity guaranteed. We pay Rs. 1000 for 100 – 200 word snippets or photos. Unfortunately, we cannot use any tips which are not backed up by enough facts)

(Techgoss had published the following on Nov 10, 2010)

Syntel: Hard conditions for bonus
By Ria Sharma

Over the last ten months, Techgoss had published a series of exclusive reports giving details of all that was happening inside the BPO, KPO and IT divisions of one of India’s most successful IT-ITES companies Syntel.  One report showed how that in the recent past Syntel BPO was overly reliant on couple of key clients. Also, reported were the exits of the CEO and key HR people.

Regular readers of Techgoss are well aware that a large number of our articles are crowd sourced.  People send in tips, story ideas and even articles. Many of our contributors have full times jobs in IT-ITES, and so prefer using a pseudonym.

One Nov 3, 2010, Techgoss had broken the story that Syntel was about to offer a retention bonus of up to Rs. 1 Lakh to its KPO workforce.  This has now been confirmed as fact.

We love our Tipsters! A regular Techgoss Tipster tells us that the bonus has not exactly been welcomed with great joy because of the hard criterion applied to it.

“
Syntel KPO is buzzing with the news that their top management had done a market survey and realized that their bright and hard working employees were being paid lesser than industry standards.  So there is a move to revise salaries.  In the meantime, each employee would be getting a huge bonus. Huge as in HUGE by Syntel Standards.

The catch?  The bonus would not be paid immediately.  It would be ‘released’ in two phases. The aim of this deferred bonus is

-To retain employees for a slightly longer period. To get the entire bonus an employee has to stay with Syntel for 1 year. Some even for a longer time.
-Reducing the immediate cash flow of the company thereby releasing the funds after a time period of minimum of 6 months. Giving a salary hike would mean a continuous outflow of cash on a monthly basis.

The KPO bonus amounts have been announced and it is as follows

Trainee (E0) - Rs 10000
Associate and Senior Associate (E1 & E2) - Rs 22,000
Team Leader (E3) - Rs 50,000
Manager (E4) - Rs 1,00,000.
“

How will the bonus be paid out?  Techgoss had reliably learnt that the bonus will only apply to those employees who have joined prior to Oct 31, 2010. But the bonus shall be paid to an employee irrespective of his / her annual rating. Trainees, Associates and Senior Associates, would be paid 40% of the bonus after 6 months starting Nov 1, 2010 i.e. in April 2011.  The remaining 60% shall be paid after 9 months after October 31 2010 i.e. in June 2011. This would mean that to acquire 100% of Rs 10,000 as bonus the Bands E0, E1 and E2 are expected to stay with the company till June 2011.

For Team Leaders and Managers, 40% would be paid after 9 months starting Nov 1 2010 i.e. in June 2011. The remaining 60% shall be paid during Jan 2012.

Techgoss has heard that when this bonus was announced to many teams, there was some laughter and derision at such strict bonus conditions.

This announcement has left a lot of unanswered questions. Trainees are confirmed as Associates after a period of six months. There has been talk of this duration being extended to 12 months in the future. Would the trainees who have been promoted as Associates in the interim period be paid the Rs 10,000?

If we assume that the sole purpose of this "Deferred Bonus" is to retain employees, then there is a flaw in this approach. Taking the example of an Associate who earns Rs 13,000 per month (conservative estimate as most Associates earn a minimum of Rs 15,000 per month). The total bonus committed to be paid to her / him is Rs 22,000 (for a period of 9 months i.e. Rs 2,444 per month). If the employee were to opt for a job change in November / December 2010 with a 20% hike (again a conservative estimate as many employees get as much as 40 % hike, sometimes even a 70% hike).The employee would have an increase in earnings to Rs 2,600 per month. Further this hike would be a permanent one as it is a part of his salary and not a bonus amount. In that sense, this bonus may not achieve its aim.