The Case of Illegal Lay-Off at Infosys - Why SEBI Should Take Action Against Infosys on Wrong and False Reporting.

In February 1993, Infosys listed its shares in the stock exchange. This became  Listed Entity under the SEBI. By virtue of listed entity under SEBI, the Infosys complies with the Listing Agreement Clause 49 and directors of the Infosys, submit report to the SEBI that on the compliance programmes covering Labour, Social, Human right and sustainable practice there is sound system and no violation. 

In 2022 and 2023, similar statements have been filed by the Infosys to the SEBI. The disclosure is only on the comfortable reporting side. There is nothing on record on the labour law violation of 2022 and 2023. There has been Mass Illegal Termination in the name of "Lay-Off" ( See Box-One ) in 2022 and 2023. Again mass illegal termination has been reported on 7th Feb 2025. 

SEBI can't remain helpless. The SEBI  has social responsibility. A full scale investigation is needed from the SEBI side why labour law violation is not reported. If reported what action assurance is there. So that the instance is not repeated. This also mandates the SEBI to implement compulsory Social Impact Assessment Audit in the listed entity to audit Corporate Governance and programmes covering Labour, Social, human right and sustainable practice. The disclosure report to the SEBI should must be based on the Social Impact Assessment Audit report submitted by the auditor. 

The European Union on 19 November 2024 has blocked entire products and services around the world made with Labour Law violation. This is good move. The Infosys Product's and services enter frequently in the European Union. Very big business is there. Shall the Infosys services or products be banned in the European Union. 

SEBI needs standard regulation in banning such listed entities, to operate in the market, where products and services are produced violating the Labour Law.  

Everything was fine on the morning of 7th February 2025 at the Infosys Mysore campus.  As days approached, the Mysore Campus of Infosys overnight terminated more than 300 young employees. This was the  compliance violation of the Indian employment law. The Infosys HR calls it "Lay-off". But, the HR needs here training in Labour Law. This is not "Lay-Off" but a case of "Illegal Termination".  

The "Lay-Off" is always short period of un-employment where employer is unable to give job due to any situation beyond the control  of the employer. Infosys again say the employees removed from service are "Trainee under Contract". In India, the Labour Law  clearly provides the definition of "employee".  The employee is defined in the Wage Code 2019, under Section 2(k) as any person, whatever name he is designated, but other than an apprentice covered under the Apprentice Act 1961. Clearly the Infosys terminated  people under training are "employees". They are not Apprentice under the  Apprentice Act 1961. The employees can't be removed in illegal way when they are in continuous service of more than one year.The Infosys in the name of "Lay-off" has violated the Law of the land. 

Further, this is important to know Section 78 of the IR Code 2020. The Section 78 (1) of the IR Code 2020 says, there must be a valid prior permission of the Government on such Lay-Off, if Lay-Off is other than shortage of power, natural calamity, and in the case of a mine, such lay-off is due to fire, flood, excess of inflammable gas or explosion. The Lay-Off is here "Removal of employees unable to clear departmental examination". This needs prior approval of the Government. If there is No Any Prior Approval of the Government then this is Illegal Lay-off under Section 78 (8). IR Code 2020 clearly says :  

"such lay-off shall be deemed to be illegal from the date on which the workers had been laid-off and the workers shall be entitled to all the benefits under any law for the time being in force as if they had not been laid-off".   

In software industry there is an ugly HR culture. This ugly HR culture is invoked, when low cost manpower is needed to carry out low specialized routine job during the rush hour. When identified work is completed, the bulk manpower are removed in the name of "Trainee under contract". This is completely the ugly culture silently in practice in software industries in India during the last two decades. The mass termination of 2022, 2023 and Feb 2025 is  “illegal and unethical”.  This breaks the labour laws, where  due process before terminating the employees are not adopted. This is coercive employment tactics, which infringes the  fundamental rights of employees. 

Infosys conducted mass layoffs in late 2022 and early 2023, primarily removing employees for cost cutting measures. The "modus operandi" is same illegal route as adopted in February 2025. The illegal "modus operandi" on the violation of employment law is not reported to the SEBI either under Clause 49 of the SEBI's Listing Agreement or Directors Responsibility in 2022 and 2023. This needs compulsory Social Impact Assessment Audit of place of work on the compliance programmes covering labour, social, human right and sustainable practices covered under the agenda 2030. The Company Secretary or Directors should not be allowed to file defective and  "comfortable reporting". But they should must highlight the violation and improvements points raised in the Social Impact Assessment Audit report.  

☝This is clearly unhumanitarian practice. This IT Layoff Clause is  a "Trap for Freshers". 

☝This is cruelty, where big company, exploits employees in the name of training. 

☝This has affected trainees who had waited two and a half years to join the company after receiving their offer letters in 2022.

☝One female trainee from Madhya Pradesh, was asked to remove Mysore campus by 6 PM.  "Please let me stay the night. I will leave tomorrow. Where will I go right now?" The company officials responded, "We don't know. You are no longer part of the company. Vacate the premises by 6 pm." Is it healthy human management practice. No. Never. Who will report such ugly culture in the place of employment. This is compulsory Social Impact Assessment Audit. 

Youngsters who dream Infosys and Startup with golden path shall be spoiling their career. Job security is not here. One may be thrown away just like the odd 700 illegal termination at the Infosys. Think hundred times before choosing the software and startup job. Do MBA from better college choose better available option in finance, marketing or HR. The Startup in India has adopted the same trick Illegal Termination, in the name of "Lay-Off" as seen in the following data. All the HR needs education and training. They do not know the basic difference of "Lay-Off" and "Termination". The skill gap of HR has killed the ethical culture. They are very poor in Labour Law. They have no sense of Legal Knowledge. They are unfit. See how they have created havoc in the name of Lay-Off at following premises.  

                                                

                   Box - One