Bengaluru: Learning from the previous experience, Infosys has handed over a strict employment contract to its current Chief Executive Salil Parekh. Notably, Vishal Sikka, former CEO of Infosys left the company following an ugly public spat with its founders. The employment contract contains strict and detailed terms.
As per the new employment contract, Parekh within six months after quitting the company can’t join any rival company. This means as per the new contract, Parekh neither can return to his former employer Capgemini nor he can join rival companies like TCS, Accenture, Wipro, IBM, Cognizant, Tech Mahindra or HCL Technologies during the cooling-off period.
Detailed Terms for Termination of Employment
The contract is strict and detailed in terms of termination of employment. There are 14 conditions in Parekh’s contract which include refusal to follow “reasonable and lawful instructions of the board”, if it continues for 10 days after the board provides him a written notice whereas Sikka had six conditions.
As per the company filing with the US Securities and Exchange Commission the employment contract also has the condition which says, “Executive’s engaging in any wilful misconduct which is injurious to the financial condition, reputation or goodwill of the company”.
A condition that was not included in the letter of Sikka has been included in the letter of Parekh which is waiver of all rights to civil court action and also has detailed non-disclosure clauses. There is also a clause in the agreement where Parekh can be put on gardening leave which means suspension from work on full pay during the notice period which is of three month.
Various metrics have been spelt out in the contract on the basis of which the evaluation of top executives will be done in financial year 2019.
As per the filing of Infosys with the US regulator the company informed, “For CEO, the goals mirror the company targets consisting of revenue growth, operating margin percentage and organisation development goals. For other executives, performance bonus is linked to the achievement of company goals of revenue and operating margin percentage, along with components of individual goals.”