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Infosys' Global Hiring: Ethnocentric or Polycentric?

CASE STUDY, HUMAN RESOURCE MANAGEMENT
ET Cases, 14 pages

Case Preview

Infosys’ Global Hiring: Ethnocentric or Polycentric?

 

“Attracting the best and brightest talent is paramount to Infosys’ success…We are an equal opportunity employer and hire from the local market in line with our business needs. We not only post every external job opening to accord equal opportunity to everyone, but, we also advertise our job openings on a variety of local job boards.”1

- Infosys Limited


In October 2014, Samuel Marrero (Marrero), a former recruiter in the US, employed with the Bangalorebased Indian Information Technology (IT) firm Infosys Limited (Infosys), revealed that the company encouraged its recruiters to hire Indian candidates over Americans. This statement by Marrero was included in the complaint originally filed by four Infosys employees (one of them being a job seeker) at a Federal Court in Wisconsin, which alleged that the company indulged in ‘national origin and race discrimination’ by preferring South Asian candidates to fill the positions in its US offices.

Infosys termed these allegations as incorrect and stated that, “It is incorrect to insinuate that we exclude or discourage US workers. Today, we are recruiting to fill over 440 active openings across 20 states in the US. These include 300 openings for professional hires and about 140 openings targeting local and recent MBA graduates, Master’s degree holders and under graduates to bolster our sales and management consulting teams. We are committed to creating a work environment where every employee feels included, valued and respected.”2

However, Infosys has been in the eye of the storm due to the alleged violation of H-1B visa norms in 2011 and discriminatory practices in 2013. According to the US Government data, Infosys was among the largest users of H-1B visas. Analysts too opined that the high percentage (90%3) of South Asian workforce at Infosys in the US is intentional. Was it right on the company’s part to hire its workforce belonging largely from the company’s home country? Does it amount to ‘national origin and race discrimination’ as alleged in the lawsuit? How should a global company staff its foreign offices? Should a global firm adopt ethnocentric, polycentric or geocentric staffing strategy?

 



1 “Infy’s Former Recruiter in US Says Firm Favoured Hiring Indians”, http://www.business-standard.com/article/companies/infy-s-formerus-recruiter-says-firm-favoured-hiring-indians-114100800022_1.html, October 8th 2014 (accessed date: May 20th 2015)
2 Ibid.

Teaching Note Preview

Infosys’ Global Hiring: Ethnocentric or Polycentric?

 

Synopsis

This case study primarily highlights how Infosys Limited (Infosys) had been mired in various lawsuits in the US due to its global HR practices. The company was sued by two of its employees for alleged harassment, after they blew the whistle about the B-1 visa misuse and illegal I-9 practices. The company was bringing in South Asian employees from its headquarters in Bengaluru, India on B-1 visa (instead of H-1B) and making them work fulltime on various projects in the US. The lawsuits brought the issue to the notice of federal agencies and after their investigations found Infosys guilty of misfeasance, the company was slapped a fine of $34 million for B-1 visa misuse. The company was also sued on various occasions by the company employees as well as the job-seekers alleging that the company practiced discrimination and harassment based on language spoken, region, nationality and age. The notable among the discrimination lawsuits was the one that was filed by three of its employees and a job aspirant, who alleged that the company hired and promoted candidates belonging to the South Asian region (primarily Indian), which gave it the status of a class action lawsuit.

The case study allows the participants to understand the nature of Infosys’ business, its global hiring practices and the broader provisions of H-1B and B-1 visa requirements that enable Infosys employees to work in the US. It also allows participants to debate whether the company was right/wrong and helps to discuss the best hiring strategy for a global company to operate globally. At a broader level, the participants/students would be sensitized to the sensitivities involved in staffing a global company’s multiple offices spread across multiple global locations.

Prerequisite Conceptual Understanding (PCU)/Before the Classroom Discussion

  • • Gary Dessler and Biju Varkkey, “Managing Global Human Resources”, Human Resource Management, 12th Edition (Indian Adaptation), Pearson Education, Inc., 2011 – To understand the international staffing of a global organization and how inter-country differences affect HRM

 

Case Positioning and Setting

This case study can be used in either MBA or Executive MBA or Executive Development Programs, for the following modules/topics in the Human Resource Management course:

  • • Staffing the Global Organization – To understand the importance, advantages and disadvantages of the ethnocentric, polycentric and geocentric hiring practices while hiring for an international organization
  • • Legal, Political and Ethical Factors in Global Hiring – To understand the role of Laws and Acts, the political, legal and labor scenario of the host country while hiring for the global organization and the need to ethically follow these Laws and Acts

 

Assignment Questions

  • I. What do you understand about the Infosys’ nature of business in the US? Discuss about its operational capabilities for clients to contract work to Infosys and the costs involved in terms of its employees and how does it affect the company’s HRM?
  • II. What is your analysis of all the six lawsuits filed against Infosys in US? What’s the veracity of those lawsuits? Are they sinisterly motivated or are they  aterially substantiated?
  • III. .................

 

Preamble and Suggested Orchestration

This case study is meant to introduce and sensitize the participants/students to the intricacies involved in hiring the ‘right’ and ‘appropriate’ candidates for a global firm. It also highlights the need to adhere to all the rules of the land wherever the company is operating, even when the company has a different take on staffing its foreign offices. As this case study involves sufficient understanding of the given legal perspectives, the classroom orchestration has to be navigated appropriately. The case study can be orchestrated on the following suggested lines [Exhibit (TN)-I].............

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Product code: HRM-1-0035, HRM-1-0035A

Abstract


This case study introduces to the sensitivities involved in staffing a global company's multiple offices spread across multiple global locations. In the backdrop of the six law suits filed against Infosys in US courts, this case study takes the students/participants through the legal compliance and ethical standards expected of a global firm in managing its global HR. Infosys had been facing six lawsuits in the US filed by the job aspirants and employees of the company for its practices of employee discrimination and B-1 visa misuse. In 2011, Jack B. Palmer (Palmer), an employee of Infosys, filed a whistle-blower complaint with the company regarding the misuse of B-1 visas and discrepancies in the I-9 processes. When the company ignored his complaint and harassed him, he took the matter to court. The Federal Government slapped a fine of $34 million on the company for B-1 visa misuse. In 2013, four of the Infosys' job aspirants/employees filed a civil action lawsuit alleging about the company's discrimination with respect to language, regional and national bias, as it hired mostly South Asians. All along the company had been denying of any illegal practice, discrimination or harassment. The bigger question that emanates from these incidents at Infosys is what it takes for a global company to recruit and manage a global workforce at various global locations?



Pedagogical Objectives

  • To discuss on the nature of complexities involved in Infosys' global staffing given its nature of business
  • To discuss and debate on the veracity of six lawsuits filed against Infosys in US alleging the abuse of B-1 visas (instead of H-1B visas) and discriminatory policies
  • To examine the desirability of following either ethnocentric, polycentric or geocentric staffing strategies for a global firm and discuss on the implications of following either of them on the long-term prospects of a firm

Case Positioning and Setting
This case study can be used in either MBA or Executive MBA or Executive Development Programs, for the following modules/topics in the Human Resource Management course:

  • Staffing the Global Organization - To understand the importance, advantages and disadvantages of the ethnocentric, polycentric and geocentric hiring practices while hiring for an international organization
  • Legal, Political and Ethical Factors in Global Hiring - To understand the role of Laws and Acts, the political, legal and labor scenario of the host country while hiring for the global organization and the need to ethically follow these Laws and Acts




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- Abstract
- Case Study
- Teaching Note (**ONLY for Academicians)
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