Contract to Hire positions in India

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There is a huge list of Contract to hire positions all over the world but since I’m located in India, I can give an overview of what is happening here.

Gone are the days where highly skilled and qualified engineers were offered high paying jobs as a permanent employee. At this time in 2014, Contract to Hire positions are booming in the modern IT world. I cannot recollect when it actually started booming but the reasons for its existence are pretty obvious – atleast that’s what I thought.

So what is a contract to hire position? It is a position offered on payrolls of another company which is a IT service provider or consultancy or a BPO, and the employee is deputed to a big organization. The reason why bigger organizations prefer this is because they don’t have a liability to keep this employee forever. In case there is a cost cutting within the organization, they can simply terminate the contract of these employees. Whereas when they hire a permanent employee, there are labor laws and policies involved which doesn’t allow organizations to terminate an employee without giving a proper explanation, even though that is also done in lot of companies.

I have noticed a lot of IT Service providers in India, some of the big names are: Aditi Technologies, Magna InfoTech, Teamware Solutions, and Manpower. These providers did exist from long time but looks like they are definitely growing big time in modern era. Benefits for these IT providers are huge- a consultant who is involved in finding the candidate is given one time incentive but the IT provider receives a part of employee’s actual salary from the organization. It might sound tricky but that is a fact. There could be minor changes in percentages between each IT provider but getting paid for an employee’s hard work seems like an easy money for me.

Most of the big organizations like Microsoft, HP, Citrix are offering lot of CTH positions and the hiring percentage for permanent positions have drastically gone down from the past few years. From my information, there is a certain percentage of permanent employees every big organization can hire in a year and that percentage is quite low compared to hiring contract employees.

Another recent research showed that there are also a few Sub-contract to hire positions available from last year which makes the existence of an employee pretty worse. That means you would be attending for a System Admin or support engineer positions’ interview at these IT providers’ location and once you clear the interview, you would be on payrolls of another third party. For me, that sounds ridiculous.

I’m not sure where the IT jobs are heading in this direction but if this Sub-contract roles get going, things may not be very easy for good technicians and IT Professionals.

Author

ram.kumar

Iam a Microsoft Certified IT Professional with certifications in Active Directory, Network Infrastructure and Server 2008. Apart from passion for learning new technologies, I speak German and very much interested in sharing my knowledge, whether it is German or Information Technology.

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