February 20, 2017 12:04:17 am
While Infosys founders and former executives are questioning the company’s financial splurge on certain senior executives, the company had actually decreased the gross salary of about 45 per cent of its senior executives in 2015-16 — who have been getting an average salary of more than Rs 5 lakh per month and were employed throughout the last financial year.
Out of total 195 executives, which came in this salary bracket, 88 saw their gross remuneration decrease in the range of 0.45 per cent to 47.31 per cent in 2015-16, as compared with 2014-15. The information regarding gross salary of this particular category of employees was shared by the company with its shareholders — under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 — through its annual reports.
Infosys has said that this fall in remuneration can be observed in 2015-16 because long-term bonuses were paid to senior executives in 2014-15. However, people from the founders’ camp have said that this data is inadequate and the true picture can come out only when the salaries of Infosys senior executives, who are working in its foreign offices, are analysed.
“I am assuming that you have done a comparative analysis with the 2014-15 annual report and, hence, raising this question. To clarify, the remuneration of employees included in the Annual Report for 2015 included long-term bonuses paid to eligible employees for fiscal 2013, 2014 and 2015. Versus that, the remuneration reported in the 2016 annual report only has the payouts for 2016. Hence it appears to be lower,” said the Infosys spokesperson.
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In the last few days, co-founder N R Narayana Murthy, former chief financial officer V Balakrishnan, and another former CFO T V Mohandas Pai, have raised various issues related to the company’s governance norms, questioning the major pay hike of current CEO Vishal Sikka and big severance packages to two former employees of the company. Murthy did not reply to queries from The Indian Express.
When V Balakrishnan was told about this fall in gross salary of senior executives, he told the newspaper: “I was talking to you about the set of senior people who are ex-SAP guys who joined Infosys at senior levels. Since, they are all onsite, that data is not provided as part of directors report. Probably, you should get that data from the company — both on how much salary they get, how much increments and promotions they got. The Indian salary what you are mentioning is not right comparison as the company had cut the variable salaries for employees in fiscal 16 and that is the reason for the reduction.”
The Companies (Appointment and Remuneration of Managerial Personnel) Rules came into force from April 1, 2014 and, therefore, the company has disclosed the data for 2014-15 and 2015-16 only. These rules state that the board’s report must include the details of “every employee of the company” who was getting an average salary of more than five lakhs per month during the financial year.
T V Mohandas Pai told The Indian Express: “I am not sure your data is right. Pay for these people has 2 components fixed and variable.
Variable depends on performance. To make a comparison please look at the total pay of these people over the last 3 years. Further, the pay of people overseas is not disclosed. Please get pay of people in US Palo Alto office over the last two years by name.”
Surya Prakash K, a senior vice president and head of global services at one of the unit of Infosys, saw the biggest decrease in his gross salary among all of 195 senior executives. His income was reduced by 47.31 per cent to Rs 1.21 crore in 2015-16. Shyam Sundar V, an associate vice-president, saw the second-highest decline in his gross remuneration. Shyam’s income was reduced to Rs 80.52 lakh in 2015-16 from Rs 1.21 crore in 2014-15.
Ramadas Kamath U, one of the executive vice-president, saw his gross income decline by 9.16 per cent in 2015-16 to Rs 4 crore. Srikantan Moorthy, another EVP, also saw his total remuneration decrease to Rs 3.39 crore in 2015-16 from Rs 4.03 crore in 2014-15.
As per Infosys’ disclosure to its shareholders, seven senior executives of this category — average salary of Rs 5 lakh or more – joined Infosys in 2015-16. However, according to the company, the number of people who left it in 2015-16 were 62 in this category. Similarly, the number of people, who joined Infosys in 2014-15 with a salary of more than Rs 5 lakh per month, were just four. However, number of people, who left Infosys in 2014-15 while they were getting a salary of more than 5 lakhs per month, were 74.
On this issue, the Infosys spokesperson said: “Many employees who were part of Finacle with a date of leaving of July 31, 2015 were transferred to EdgeVerve. So they have not left the company, but moved to a subsidiary company.”
Pai, when asked about this issue, said that the newspaper’s data is wrong again.”When people leave they get their terminal pay which is added up as compensation. This inflators the figures considerable,” he added.
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