TCS accused over favoring Indians over American staff in its US offices, gets clean chit by US Court
TCS in the US was accused of favoring the Indian staff over the American workers. The accusations were however rejected by a jury in California that Tata Consultancy Services Ltd has discriminated on such grounds.
The company, who basically depends on exporting Indians, was announced victorious with the verdict. The jury rejected what TCS former employees claimed that they'd been sidelined and fired because they aren't South Asian.
This was one of the severals claims against the IT Indian firms who are biased for hiaring. HCL Technologies Ltd., Infosys Ltd. and Wipro Ltd. face similar claims.
"This is a shot in the arm for the industry, which has not seen anything positive come out on the US visa regulation front for some years," said Anurag Rana, an analyst with Bloomberg Intelligence.
The ex-employees who sued accused TCS of a "systematic pattern and practice of discrimination" by favoring Indian ex-pats and visa-ready workers from India for US positions. That has resulted in a workforce that's almost 80 per cent South Asian, far greater than the 12 per cent representation of South Asians in the US IT workforce, according to the complaint.
At trial, the plaintiffs cited 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. They said that 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.
TCS attorneys argued the company had no incentive to discriminate, having spent millions of dollars on building a local talent pool in the US Employees were terminated because they were unwilling to move to cities in the U.S. where TCS needed more engineers, the company said.
"We have always maintained the claims made in this case were baseless, and we are gratified that the jury agreed," Ben Trounson, a spokesman for TCS, said in an emailed statement after the verdict. "The decisions we make about the hiring and retention of employees are based purely on their abilities and fit to serve our clients' specific needs."
A unit of the Tata Group, India's largest industrial conglomerate, TCS employs more than 400,000 people worldwide, is valued at about $100 billion and posted revenue of $19 billion for the fiscal year that ended in March. Most of its revenue comes from the US, and its primary customers are in the financial services sector.
