Technology giants IBM and Dell have started the process of downsizing their India workforces, according to people with direct knowledge of the matter.

While Dell has initiated what it calls a “voluntary separation programme” that offers employees an exit option along with a hefty severance package as incentive, IBM's first round of the “resource action”— IBM parlance for retrenchment—saw employees being handed out pink slips.

According to a Dell employee, who did not wished to be named, close to 150 employees at the company’s SAS Nagar unit near Chandigarh have opted for the voluntary separation programme—which comes with a hefty severance package.

In response to The Hindu’s queries on downsizing, a Dell spokesperson confirmed that a “small percentage of the Dell’s global team members accepted the company’s offers of a significant severance package associated with a voluntary separation programme.”

“We will continue to make prudent business decisions over time. Meanwhile, Dell is hiring in strategy areas including hardware and software development and customer coverage worldwide,” the spokesperson added.

IBM round

IBM’s round of job cuts has affected mostly the systems and technology group (STG) division.

Employees and those in the know posted about job cuts with versions varying between a “few dozens” and over 60 at IBM’s STG, its hardware business unit in Bangalore.

In response to The Hindu’s detailed queries, an IBM spokesperson said, in an email, “As reported in our recent earnings briefing, IBM continues to rebalance its workforce to meet the changing requirements of its clients, and to pioneer new, high value segments of the IT industry. To that end, IBM is positioning itself to lead in areas such as Cloud, Analytics and Cognitive Computing and investing in these priority areas.”

The statement added that “IBM’s total workforce has remained stable over the past three years, and IBM now employs more than 400,000 people worldwide.”

500 IBM workers

According to a junior HR source, the “unofficial word” is that over 500 workers in core technology or hardware verticals will be retrenched in IBM offices across the country. The source said that this was in all likelihood “only the first round” and that this was part of global restructuring that would specifically involve contract employees. An employee who works at the company’s Embassy Golf Links office here, in a division separate from the STG, said that there were rumours that there would be more pink slips on Friday in the networking solutions team. He also said that the retrenchments were not linked to the performance improvement plan.

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