Layoff Fears Wash Ashore...
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with her belongings.
The dream job has turned into a nightmare. Lehman Brothers’ staff in Mumbai, the largest in Asia, spent Tuesday clearing their desks and calling headhunters as they brooded over a horrific week that turned their lives upside down.
The nail-biting wait for the inevitable pink slip has begun.
At their tony Ceejay House office in Mumbai’s posh Worli area, employees have been asked to carry on work as usual even though email and telephone connections have been suspended.
“In reality, there is no work to speak of as our London office, with which we work closely, has suspended trading. The management is trying hard to maintain a semblance of corporate discipline. But yesterday at an internal meeting, we were told to polish up our CVs and look for jobs. People were told the company would not be able to offer any clarity on their roles at work,” said an employee at the investment banking service office of Lehman at Worli where 180 people work.
Lehman’s second set-up in Mumbai’s Powai area — a back office that employs nearly 2,000 people — is expected to fold up this week. Last month, the company fired over 200 employees from its back office.
“The fear of a job loss is now real. The most difficult part will be to explain things to family and friends. A job loss in this country is a social disgrace — nobody cares if it is because of a global meltdown,” said an employee at the Lehman back office.
Employees at both the Worli and Powai offices have been told that if they are asked to leave, it is unlikely that they will be paid the three-month severance package as is customary.
“We have been told we may have to do with just a three-week to a month’s pay in lieu of notice. The atmosphere here is tense,” said an employee at the Powai office. “I tried approaching a recruiter today. I was told Lehman staff CVs were floating all over,” she added.
Meanwhile, the Reserve Bank of India tightened its vigil on the domestic arms of Lehman. It directed Lehman Brothers Capital Pvt Ltd — a non-banking finance company — not to remit dollars abroad without its approval.
The central bank also asked Lehman Brothers Fixed Income Securities — a primary market dealer — not to declare an interim dividend or make any remittances to either its holding company or a group company without getting its clearance. It has also been ordered to stop trading in government securities.
In Delhi, commerce minister Kamal Nath couldn’t resist taking a swipe at the US financial sector, which has been blaming India for over-regulating its financial markets. “Those who preached to us about adopting best practices didn’t follow it themselves,” Nath said about the turmoil in the US financial markets.
“We will be assessing its impact on India over the next few weeks,” Nath said.
Lehman Brothers tried to soften the blow for its Indian employees by trying to hire counsellors who would help them through a difficult phase.
An Indian agent of an Australian firm dealing with outplacement and transition services, told The Telegraph that her company’s New York office was approached by Lehman Brothers’ head office last month to counsel retrenched employees. However, that deal did not work out in the end.
Corporate outplacement firms plan for workforce reductions and help former employees in finding new positions.
“With the markets down and brokerages scaling back operations, the retrenchment could not have come at a worse time for Lehman staff,” said the employee at the investment banking division.
Lehman’s Indian operation is the largest in Asia in terms of workforce. The bank employs 3,000 people in Asia Pacific excluding the 2,000 people at its Mumbai back office.
“Management and engineering graduates like me who get placed with Lehman Brothers draw opening annual salaries of Rs 10 to 18 lakh. It is unlikely that after being retrenched, we will get similar jobs,” said a fresh IIM graduate at the capital markets division in Worli.
Courtesy: The Telegraph