After Infosys, TCS is now facing racial discrimination charges in the US, its largest customer market. A few American employees, who have lost their jobs, have raised the allegations and TCS will face trial in California starting Monday, reported Bloomberg.
The trial beings amid tension and uncertainty over H1-B visa. Many Indian companies have exported manpower, a practice that has not found favour with US president Donald Trump.
Responding to the development, Peter Bendor-Samuel, chief executive officer and founder of California-based Everest Group, told Financial Chronicle: “TCS along with the other Indian firms are facing a growing scrutiny under a difficult political environment in the US. We have seen similar law suits against Infosys and expect to see more against the other firms.”
It’s the cultural difference that is at the root of the problem, TCS and other Indian firms have rely on importing Indian talent through H-1B and L-1 visas and they transport this culture to the US. American employees are not used to this type of working culture and this has caused a number of them to leave TCS and the other Indian firms.
“The TCS and other Indian firms employment demographics for US employees are heavily weighted with Indian and Indian diaspora employees. This has clearly contributed to a sense with other demographics that TCS and the other Indian firms favour Indian employees,’’ said Bendor-Samuel.
TCS and the other Indian firms are clearly vulnerable to charges of discrimination and favouring Indians over other classes. The litigants do not need to show specific examples of discrimination, only the results from a pattern of discrimination. Given the political environment that now exists it will be very unwise for TCS and the other Indian firms to allow the current status quo to continue. They will need to take significant action to address the appearance of the favouritism as well as change parts of their corporate culture and employment policies and benefits structure to bring it more in line with US expectation.
The lawsuit was brought as a class action on behalf of about 1,000 non-South Asians -- most of them US citizens -- who were fired by TCS while on “benched” status, meaning they were laid off by the company while they were between job assignments, said Bloomberg
TCS denied any unlawful bias in its US operations and said in court filings that the Caucasian American leading the lawsuit was removed from one of its projects and ultimately terminated over “performance concerns.”
“Our success is based on our ability to provide the best talent available, both in the US and globally, based purely on the individual’s specialized experience, skills and fit for each client’s specific needs. TCS also strictly adheres to all federal and state equal employment opportunity laws and regulations,’’ Bloomberg reported quoting a company official as saying. As per the compliant, the jury is expected to be shown statistical evidence that the odds of race and national origin not being a factor in TCS’s termination decisions are less than one in a billion. That’s because, since 2011, the company fired 12.6 percent of its non-South Asian workers in the US, compared with less than 1 percent of its South Asian employees.
The plaintiffs alleged that TCS has engaged in a “systematic pattern and practice of discrimination” by favouring Indian ex-pats and visa-ready workers from India for U.S. positions. That has resulted in a workforce that’s almost 80 percent South Asian, far greater than the 12 percent representation of South Asians in the US IT workforce.