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MNCs are slashing salaries across India: Zinnov
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MNCs are slashing salaries across India: Zinnov
Manu Sharma
"Though Bangalore stands highest in its average salary for multinational R&D firms, followed by Pune and Chennai, the economic slump is causing undue pressure on them to retain compensation levels," said C.S. Chandramouli, director for advisory services, Zinnov Management.
The IT salaries in 2009 would see a freeze across the board in a majority of the firms surveyed, while the average increment would be in the 5-12 % range, Chandramouli said.
About 30 representative multinationals from Bangalore, Pune and Chennai were surveyed and it indicated that 27% of them had frozen salary increases this year, while 42% said they would provide salary increases and 15% have postponed their merit increase cycle to take a call at a later stage if the economic scenario changes.
As a preferred destination for IT services and R&D, about 680 multinationals operate in India. Many of them have more than one R&D centre and presence in one or two of the three cities surveyed.
The Zinnov`s annual report on Compensation and Benefit Study 2009 shows that 12% of the MNCs have announced 5-10% salary cuts either for senior management or across all levels.
"The survey highlights that multinationals are also shifting focus to the variable pay component to reward and retain top performers as opposed to fixed pay. Some of them have even restructured their compensation, linking employee rewards to individual and organizational results," the report said.
Referring to the adverse impact of the tough economic conditions on the compensation budgets, Chandramouli said MNCs were attempting to balance their need to retain key talent and address concerns over wage increase.
"Organizations are being proactive in managing people cost as it constitutes about 62% of the total operating cost," he said.
Source:
http://www.cxotoday.com/India/News/MNCs_Are_Slashing_Salaries_Across_India_Zinno
