Why 90 days’ notice is hurting the reputation of the IT Industry in India?
Posted on August 14, 2022 / By Sanjay KabraWhat is the origin of 90 days notice period?
The origin goes back to the early 2000 when the IT industry was booming and there was a talent shortage. The idea behind this extended notice period was to manage the continuity of projects with some overlapping time between the talent.
The majority of the Large and established IT companies in India are practicing 90 days notice period, which has not left much of an option for small and mid-size companies to follow the practice.
Problem Statement
- Fast forward to 2022, the demand and supply of talent are more balanced but the industry has not moved away from the practice. The industry is preferring to maintain the status quo putting a blind eye to its repercussions.
- In reality, it takes only 15 days to hand over the responsibility to someone with similar experience. However, the transition of responsibility doesn’t even start for the first 75 days of the notice period. By this time the resigned employee is already switched off and stops cooperating.
- Instead of helping with the continuity, it encourages inefficiency and negatively impacts customer satisfaction.
The misuse of 90 days notice period is widespread by both the sides.
Loss of Ethics and Goodwill
The IT industry in India is earning a bad reputation and losing goodwill because of the loss of Ethics in the conduct of both employees and employers.
- The number of employees leaving abruptly (termed as absconding by the employer) has sharply increased in the last few years. This is directly resulting from the long extended notice period.
- The employer forces 3 months notice period for those who have spent even a day of employment. This is simply a strong-arm tactic to refrain employees to switch at will.
- The resigned employees have started using 90 days notice period to hunt for additional offers. This results in the existing employers unintendedly paying the employee to search for multiple offers.
- The employer, on the other hand, starts “Bidding” higher for candidates who have very few days remaining in the notice period. The situation is such that the biggest qualification of the candidate is the “Notice Period” or the lack of it. The merit of the candidate has taken a back seat.
Employers “Bidding” on the lower notice period candidate or employees “Absconding” without proper handing over, are some of the ailments IT industry is facing.
Why is 15 days notice period a better option?
For candidates: Such an option will ensure that some level of succession or bench planning will be in place to kick start the knowledge transition immediately upon notifying the decision.
For Employer: They can confidently start offering positions to candidates on a merit basis only, as there will be a much higher probability of candidates joining upon accepting the offer.
What are the other alternatives?
Alternative #1: The notice period is linked to the period of employment in the UK and European countries. This represents the depth of knowledge acquired by the employee.
Alternative #2: The employment in The USA is “at-will”, so contractually no notice period is required to be served. However, the unregulated practice is to provide 15 days of notice to part on a good note.
Alternative #3: The role of the individual drives the notice period. The pyramid of the employees helps decide the notice period. The lower end of the pyramid gives the lowest notice period. The Sr Management and Executive Management team serves the highest notice period.
What has been done about it?
Several petitions have been initiated over a period of time through change.org, but all of them eventually were closed without any resolution
References
https://en.wikipedia.org/wiki/Notice_period
These are my personal views and have no bearing on any individual or company.