Infosys has conceded that attrition rates at the company, which has an employee strength of over 1.6 lakh employees, has touched worrisome levels.
"At 18.7 per cent, compared to 16.3 per cent for the year-ago period, this metric is at an all-time high, and has touched “uncomfortable levels," said CEO S.D. Shibulal. He said that employee attrition today was a bigger concern for the company than top-level exits, seeking to downplay the impact of the nine executive exits the company has seen since company founder N.R. Narayana Murthy returned to the company .
Since July last, the company has given two wage hikes , including a recent increase of 6-7 per cent across off-shore employees effective April 1.
Apart from these, the company was in the midst of several other employee-retention measures, including restructuring the variable pay programme, stepping up promotions, ramping up of certification and training programmes and a fast-track process for employees, Mr. Shibulal said.
“We are confident that these measures will help arrest the trend,” he added.
The employee utilisation at the company was up by 6 per cent, from 70.7 per cent in the previous fiscal, Mr. Shibulal said. This, coupled with visa costs, could impact operating profit margins in the quarter ending June, CFO Rajiv Bansal said.
Operating margin for the current quarter was at 25.5 per cent, up 50 basis points from a quarter ago. “Our margins for April-June 2014 are likely to take about 250-300 basis points hit due to wage increments and visa costs. For 2014-15, we expect margins to stay around the same levels as FY14, that is, around 24 per cent,” he added.
