Infosys decides to comply with Karnataka order on Kannadiga reservation
Infosys, which employs over 3.15 lakh people globally, stated its intent to comply with these new regulations, despite the bill being temporarily put on hold due to backlash from business leaders.
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Infosys will adhere to Karnataka's proposed regulations on reservations for locals in private firms, according to CEO Salil Parekh. This announcement follows the state’s introduction of the Karnataka State Employment of Local Candidates in the Industries, Factories, and Other Establishments Bill, 2024.
The bill, approved by the state cabinet, mandates that 50 percent of management roles and 70 percent of non-management roles in industries, factories, and other establishments be reserved for local candidates. Infosys, which employs over 3.15 lakh people globally, stated its intent to comply with these new regulations, despite the bill being temporarily put on hold due to backlash from business leaders.
Parekh emphasized Infosys' commitment to aligning with state and central regulations, saying, "We will support whatever regulations and guidelines come, ensuring we are aligned with new laws."
Industry leaders have expressed strong opposition to the bill. The National Association of Software and Service Companies (NASSCOM) warned that such restrictions could lead to companies relocating due to a scarcity of local skilled talent. This sentiment echoes the response to a similar bill in Haryana, which mandated a 75 percent reservation for local residents but was struck down by the Punjab and Haryana High Court in November 2023.
Samir Nigam, CEO of fintech giant PhonePe, criticized the proposal on social media, labeling it a "shame" and highlighting the potential impact on job opportunities for individuals who have lived across various states due to their parents' transferable jobs.
Prominent voices from the industry, including TV Mohandas Pai, former CFO of Infosys, and Kiran Mazumdar Shaw, Managing Director of Biocon, have condemned the bill. Pai called it "discriminatory, regressive, and against the constitution," while Shaw emphasized the need for skilled talent to maintain Karnataka's status as a tech hub. She advocated for exemptions for highly skilled recruitment from the policy.
R K Misra, co-chairman of ASSOCHAM Karnataka, also criticized the move, suggesting it could deter Indian IT and Global Capability Centers (GCCs) from operating in the state.
As the debate continues, Infosys and other companies are preparing to navigate the evolving regulatory landscape while voicing their concerns about potential impacts on business and talent acquisition.
