This is in one of India’s biggest ever layoffs as L&T terminates its 14,000 employees from workforce. Larsen & Toubro is the biggest Engineering firm in India. During first half of Financial Year – 2017, Larsen & Toubro generated earnings worth Rs 46,885 crore, which is 8.6 more compared tp the last Financial Year. If the company was earning profits, then why was the decision to fire 14000 workers was taken. So here is the reason behind it. L&T laid off 11.2% of its overall workforce and said it was done in regards to business slowdown and also because digitisation of operations caused unemployment that led to downsizing.
R. Shankar Raman, the Chief Financial Officer of Larsen & Toubro company tried to explain the terminations of 14000 workers, as he said “It was a strategic decision that if a business is not in good shape, we are trying to resize it. If we believe that some business will take some time to get back to normalcy, it is important that we reduce under-recoveries. We are redefining roles and jobs which are redundant, we are allowing people to move on. It is across businesses.” He however mentioned this was a one time decision and not a target that it has set for laying off people.
As per reports, the company has been dealing with many challenges with customers deferring orders and falling oil prices contributing to a sharp slowdown in the Middle-east, one of its biggest bets. L&T launched a five-year strategic plan this year aiming to scale up revenue to Rs 2 lakh crore. The plan identifies some non-performing businesses that have been put under scanner and call on them will be taken in 18-24 months. Several construction and engineering Projects of Larsen & Toubro has been stopped in Middle East due to falling oil prices. Current demonetization move of Indian Government can not be the reason for such a huge termination of L&T workers.