TCS has issued a statement on these allegations
“The recruitment activities in TCS are not handled by the Resource Management Group (RMG) as alleged, therefore the reference to alleged scam in recruitment process is incorrect. RMG is responsible for allocation of available resources to various projects and incase of any shortfall, fill such requirements through contractors. The complaint referred to in the article relates to hiring of such contract resources employed by the contractors. On receipt of the complaint, the Company launched a review to examine the allegations inthe complaint. Based on the review: (i) this does not involve any fraud by or against the Company and no financial impact; (ii) the issue relates to breach of Company’s Code of Conduct by certain employees and vendors providing contractors; and (iii) no key managerial
person of the Company has been found to be involved.”
Indian IT major, Tata Consultancy Services Ltd, has been rocked by a massive scandal after the revelation of a few senior executives entrusted with hiring thousands of critical personnel, accepting bribes from staffing firms, hence compromising the recruitment process.
TCS Bribe Scandal Revealed
In the past three years, this IT major has added about 50,000 people on average annually.
So far, the exact details of the scam are sketchy.
However, the sources aware of the developments said a whistleblower, in a communication to TCS’s chief executive officer and chief operating officer, alleged that E.S. Chakravarthy, the global head of TCS’s resource management group (RMG), the company’s recruitment division, had been accepting commissions from staffing firms for years.
TCS Conducting Investigation
Considering the complaint, TCS promptly set up a team of three executives including the firm’s chief information security officer, Ajit Menon, to further investigate the allegations.
After conducting weeks of investigation, the IT major sacked four executives from RMG, blacklisted three staffing firms and sent the head of recruitment on leave.
It appears that the company is yet to ascertain the scale of the irregularities.
But, the people involved in the scam may have earned at least Rs 100 crore through commissions, according to sources.
The names of the staffing firms that have been blacklisted is not revealed yet.
During 1997, Chakravarthy, who holds the rank of vice president, joined TCS.
As per the hierarchy, he used to report to the chief operating officer, Natarajan Ganapathy Subramaniam.
Who has been debarred from coming to the office, although his email ID is still active, according to sources.
A TCS spokesperson said,“While there are complaints regarding code of conduct violations that arise from time to time, the company has robust processes for investigating and resolving them to closure.”
TCS’s RMG division, estimated to be 3,000-strong.
It places almost 1,400 engineers, including new hires, on projects daily thus averaging a placement per minute.
How Does This Affect?
The development is a first of its kind as the recruitment scandal hit TCS, comes after K. Krithivasan took over as the company’s chief executive on 1 June.
An executive said, “The entire senior leadership is shocked.This makes you question if there were enough guardrails, and how could such a thing happen.”
Further adding, “the disturbing thing is that we don’t know how pervasive and for how long this scam was continuing. We hired over 300,000 people, including contractors, only in the last three years. Even if 10% of the entire recruitment was made through selected staffing firms and the staffing firm gave a commission on every person recruited, you can imagine the scale of this scandal. I believe it will be at least ₹100 crore.”
The revelation comes as a surprise as major corporations are expected to have robust safeguards to prevent corruption that could hamper operations and sully their image.
IT Employee Union NITES Reacts
Reacting on this unfortunate development, Harpreet Singh Saluja, President, Nascent Information Technology Employees Senate NITES said,
“Nascent Information Technology Employees Senate (NITES), representing the collective voice of IT professionals across the nation, has written to Ministry of Labour and Employment Government of India regarding a grave matter of corruption and malpractice that has come to light involving Tata Consultancy Services (TCS), one of the leading IT companies in India. The recent revelations of a bribes-for-jobs scandal involving Rs. 100 crores within TCS have had severe implications for the existing and future employees, as well as the overall economy and the IT sector as a whole. The impact of this scandal on the existing and future employees of TCS cannot be overstated. It has created an environment of distrust, affecting the morale and motivation of the workforce. Furthermore, the repercussions of this scandal extend beyond the immediate workforce. The economy at large suffers as a result of corrupt practices in the corporate sector. It undermines fair competition, obstructs merit-based hiring, and creates an environment of mistrust and uncertainty.
We believe that by addressing this issue promptly and effectively, the government can protect the rights of IT workers, restore faith in the sector and foster an environment that encourages growth and innovation.”
