Infosys CEO Vishal Sikka. Photo: PTI
Didn't get that pay hike you wanted? If you're glum and schadenfreude is your kind of thing, then read on. You're not alone, big names like Vishal Sikka, Azim Premji and Kumar Mangalam Birla saw their paychecks shrink in financial year (FY) 2017.
Sectoral turmoil and poor company performances are to be blamed for the shrinking payouts.
Sikka, CEO of Infosys, and Premji, Chairman of Wipro, saw their compensation cut by over 60 per cent in FY17 as the information technology (IT) sector grapples with an ongoing slowdown due to global headwinds, tightening immigration norms and disruption caused by the shift to automation.
As reported earlier
, Sikka's salary dropped over 67 per cent in FY17 on lower bonus payout. According to the Infosys annual report, the cash component of Sikka's salary was Rs 16.01 crore for FY17, down from Rs 48.73 crore in FY16. Similarly, as reported earlier
, Premji took home 63 per cent less compensation in the previous financial year. Premji earned a compensation of $108,026 (around Rs 71.4 lakh) in FY17, down from $292,991 (Rs 1.93 crore) in the year before, according to the company’s annual filings with the US Securities and Exchange Commission.
The big paychecks, largely based on bonus payouts and performance-linked components, have been cut at a time when IT employees lower in the hierarchy are contending with an arguably more ominous problem — mass layoffs
Indian IT firms are witnessing their slowest growth in a decade, while global firms are shifting their budgets from traditional IT services to newer areas such as digital and cloud, which require engineers to engage with clients instead of working remotely. (Read more
IT isn't the only sector facing tough times. Reams of reports and articles have been written till now on the challenging business environment in India's telecom sector.
As a result, Birla, chairman of Idea Cellular's parent organisation Aditya Birla Group, saw his FY17 remuneration from the telecom firm shrink drastically as the operator posted an annual loss for the first time as a listed entity, the Economic Times
reported on Friday.
Birla, according to the report, took home just Rs 3.30 lakh in 2016-17, compared to Rs 13.15 crore in the previous financial year, Idea's annual report showed.
In March this year, facing disruption and a tough business environment after Reliance Jio's entry, British telecom major Vodafone and Aditya Birla group-run Idea Cellular announced the merger of their operations, creating India's largest mobile operator by customer and revenue market share. (Read more
FMCG major Hindustan Unilever Managing Director and CEO Sanjiv Mehta received a pay package of Rs 14.20 crore for the last financial year, with no increase in his salary
from the FY16, reports said.
The average increases every year is an outcome of the company's market competitiveness as against its peer group companies, the company said.
The freeze in Mehta's salary comes at a time when Indian FMCG companies
have been facing trying times amid intensifying competition from both incumbents as well as new peers such as Patanjali, and slowing consumption demand in both urban and rural markets. HUL, in particlar, is reportedly looking to trim its workforce by 10-15 per cent in its bid to achieve cost rationalisation. (Read more