400 senior executives accept Cognizant’s voluntary separation package

About 400 senior executives of Cognizant have accepted the company’s voluntary separation package (VSP), a move that the US-based company said will help it save about US$ 60 million annually.

In May, the company had initiated a voluntary separation programme, offering up to nine months of salary as part of it to some of its top-level executives in the US and India. Cognizant has a significant chunk of its total 2.56 lakh workforce in India and it is estimated that of the 400 people who opted for the separation, a large number could be from India. However, the company did not disclose the number of Indian executives who have accepted the offer.
“Of the US$ 39 million of realignment charges, US$ 35 million was for the roughly 400 associates who accepted our VSP. We expect approximately US$ 60 million of annualised savings as a result of the VSP,” Cognizant CFO Karen McLoughlin said at a recent investor call.

She added that Cognizant expects to incur additional cost related to advisory fees, severance, lease termination, and facility consolidation costs in the remaining part of 2017. McLoughlin said the company has also made “good headway” in the June quarter driving utilisation rates higher by …read more