Cognizant's latest filing with the US SEC has revealed that the company's employee strength in India fell by 8,000 in 2017, to a total of 180,000. Possibly the first decline for India in the company's history, the revelation also stands in marked contrast to the big increases in the India headcount that it saw in the past four years. Varying from a low of 10,300 in 2015 to 40,100 in 2014, the company had a headcount addition of 38,500 even in 2016. In its SEC filing, the company said it incurred $53 million in severance costs, including those related to the voluntary separation programme.
Cognizant is however, hiring more in other nations. It added 2,900 employees in North America in 2017, 2,300 in Europe and 2,600 in other locations. The total number of employees in North America and Europe were 50,400 and 13,800 respectively. In 2016, its headcount in North America had gone up by 6,700. “In 2017, we began a realignment of our business to accelerate the shift to digital services and solutions while improving the overall efficiency of our operations,” the SEC filing said. Earlier last year, chief financial officer Karen McLoughlin told analysts in a call that there was no big price differential for the same set of skills while hiring onshore.
The employee realignment has reduced the India employee strength as a proportion of total employee strength to 69 per cent in 2017, from 74 per cent in 2014. Cognizant incurred $36 million in costs related to the FCPA (Foreign Corrupt Practices Act) investigation and related lawsuits in 2017. It is an addition to the $27 million it incurred in 2016 on the same matter, taking the total so far to $63 million. The company said it expects to continue to incur expenses related these matters this year.