Cognizant job cuts: IT company likely to cut more jobs; defers campus hirings

US-listed IT company Cognizant is likely to oust a few hundred more employees to cut costs. This is another round of layoffs after the company fired its middle-level executives in May to slash its costs and restore growth.

The company is also looking at more ways to cut its spending. Cognizant under the leadership of its new CEO Brian Humphries is undertaking an extensive restructuring process, which is intended towards pushing growth and bringing down the costs, the Economic Times reported. The number of employees to be laid off will be a few hundred and those with more than eight years of experience would be targeted i.e., the middle-level employees.

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The news daily had earlier reported that Cognizant was considering ways to boost the variable pay component of salaries as this move would help the company lower its costs under its restructuring process. "It is part of the appraisal process; it is getting stricter. If you were a marginal performer or have not been allocated (a project), then they would look at beginning a separation process," the daily reported quoting a source.

A Cognizant employee also said the company was assessing the number of job cuts and the same would hinge upon its growth as the quarter progresses. The company has already discontinued non-essential travel and has also taken other steps to limit its spending. Moreover, the IT company has extended the time between giving offer letters to new employees and allocating their joining dates, the report said.

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Cognizant earlier this year had cut its revenue growth projection and said that its headcount addition had surpassed its revenue growth in the past two quarters.

CEO Humphries, who took over the baton from Francisco D'Sousza on April 1, had earlier said Cognizant would strive to bring the cost of delivery down through "pyramid actions".

Besides bringing the costs down, Humphries also said he was going to concentrate on investing so that Cognizant could go back to clocking stronger growth rates. "Investments, of course, can take many forms, including marketing, demand generation, partnerships, reskilling, increased sales coverage or increased spend on platforms tools and automation," he had told analysts in a post-earnings conference call in May.

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