Sexual Harassment at Infosys

Submitted To: Mr. Vikrant Prashar Asst. Professor,LHSB

Submitted By: Prashant Gupta RQ1903A22, MBA (H)

Lovely Professional University

makes an unwelcome demand or request (whether directly or by implication) for sexual favours from another person. combating sexual harassment involves developing understanding of what is sexual harassment and change of attitudes in all. in the form of pictures/cartoons/pinups/calendars/screen savers on computers/any offensive written material/pornographic emails. colleagues. brushing. and further makes it a condition for employment/payment of wages/increment/promotion etc. Sexual harassment is any unwelcome sexually determined behaviour. pinching etc. etc. touching. like grabbing. both subtle and direct. administrators. terror and reprisal. . is borne out of the patriarchal values operating in society. and present in all kinds of organisations. looks are part of any woman’s life. which has to be systematically tackled. which belong to male domains within patriarchy. wolf-whistles. Working women are no exception. friends. Lewd remarks. It is used to remind women of their vulnerability and subjugated status. Thus. employers or the law makers. such as:     Physical contact A demand or request for sexual favours Sexually coloured remarks Showing pornography Any other physical. exploitative. Sexual Harassment takes place if a person: subjects another person to an unwelcome act of physical intimacy. Sexual Harassment at work is an extension of violence in everyday life and is it employees. often hidden. thriving in atmosphere of threat.Sexual Harassment at Infosys: Phaneesh Murthy Case Sexual harassment is all about expression of male power over women that sustain patriarchal relations. In fact. touching. so much so that it is dismissed as normal. makes an unwelcome remark with sexual connotations. Yet it is still not always viewed as a problem. working women most commonly face the backlash to women taking new roles. like sexually explicit compliments/cracking loud jokes with sexual connotations/ making sexist remarks etc. Studies find that sexual harassment is still endemic. In a society where violence against women. shows a person any sexually explicit visual material. The issue is of concern for both women and the employers as studies show that sexual harassment touches lives of nearly 40-60% of working women. verbal or non-verbal conduct of a sexual nature. Sexual Harassment affects all women in some form or the other. force women’s conformity to gendered roles. These patriarchal values and attitudes of both men and women pose the greatest challenge in resolution and prevention of sexual harassment.

that dented its reputation as a company that had the best corporate governance structure in the country. Reka Maximovitch (Reka) alleged that Phaneesh had sexually harassed her and unlawfully terminated her employment. The events that took place during October 1999 and December 2000 became public knowledge in India only when Phaneesh Murthy (Phaneesh). The company's share price declined by 6. Quid pro quo and hostile work environment are the two broad types of sexual harassment: Sexual harassment at workplace is generally classified into two distinct types. Phaneesh said that he had resigned in order to focus on fighting a lawsuit filed against him in the US. physical contact/brushing against female employees are some examples of hostile work environment. the head of the sales and marketing. which are not made conditions for employment. and communication and product services division of Infosys (and a director on the board). . threats. 'Quid pro quo'. making offensive gestures. or even non-verbal. It is sexual harassment if a supervisor requests sexual favours from a junior in return for promotion or other benefits or threatens to sack for non-cooperation. The lawsuit. etc. demotion. resigned from his post in June 2002. Infosys became entangled in a scandal. 'Hostile working environment' is more pervasive form of sexual harassment involving work conditions or behaviour that make the work environment 'hostile' for the woman to be in. sex. like staring to make the other person uncomfortable. It is sexual harassment for a group of workers to joke and snigger amongst themselves about sexual conduct in an attempt to humiliate or embarrass another person. stalking. kissing sounds.6% soon after Phaneesh left. filed by his former secretary. It is also sexual harassment for a boss to make intrusive inquiries into the private lives of employees. Certain sexist remarks. means seeking sexual favours or advances in exchange for work benefits and it occurs when consent to sexually explicit behaviour or speech is made a condition for employment or refusal to comply with a 'request' is met with retaliatory action such as dismissal. Interestingly. or persistently ask them out. display of pornography or sexist/obscene graffiti. which could be verbal.engages in any other unwelcome conduct of a sexual nature. As a result. all this happened in and around the US offices of Infosys. difficult work conditions. oppression. The fall of a High Priest This is a story of blackmail. hurt feelings and revenge. between October 1999 and December of India's most well-known and respected software companies.

as many more shocking events unfolded over the next one year. Either the victims kept quite due to fear of social ridicule (laugh at) and fear of losing their jobs. Analysts wondered how a company that Forbes had once described as "a model of transparency. This is a very 'easy to identify' and comparatively 'easy to prove' form of sexual harassment. promotions. perks. depending on the social norms prevalent in various parts of the world. The 'hostile working environment' form of harassment. Reka and Infosys and the issue of sexual harassment at the workplace (in India as well as abroad) were debated heatedly in corporate and media circles. It was also being seen as an event that could make Indian companies stop ignoring the sensitive issue of sexual harassment at the workplace. would be possible only if the employee consents to the former's sexual advances. Broadly speaking. this has been defined as. Analysts claimed that the company had kept the issue under wraps for a long time. Media reports blamed Infosys for neglecting to formulate/implement a structured policy regarding sexual harassment and for compromising on moral values for an'economically-valuable' person like Phaneesh.' ridicule Quid pro quo involves making the conditions of employment contingent on the employee (prospective/existing) granting the employer sexual favors. it was either not reported or ignored. is more difficult to identify and prove. sexual harassment at the workplace can be divided into two categories: 'quid pro quo' and 'hostile working environment. "When the workplace is permeated with 'discriminatory . As per a 1993 US Supreme Court ruling." do such things! The saga of Phaneesh. facilities etc. which is the basis of most of the court cases filed.The case attracted a lot of media coverage since a sexual harassment lawsuit implicating such a senior official had never been heard of in the Indian corporate world. or the matter was somehow hushed up by the management. Background Note The sexual harassment of employees manifests itself in different ways.not just for the rest of corporate India but for companies everywhere. The employer makes it very clear that hiring. The stance adopted by Infosys in this case seemed to go against its image of a company considered to be a model of good corporate governance. While sexual harassment of female employees was prevalent in the country.

he was made the head of worldwide sales. Before joining Infosys. Reka vs. Sonata Software as a regional manager. organization or office. is behind Phaneesh Murthy's abrupt resignation as Infosys Technologies' head of sales and marketing in the US.intimidation. the rather 'free' behavior of Japanese bosses towards their female subordinates would come as a shock to people from the US or many other parts of the world." Thus. Phaneesh & Infosys Phaneesh was an integral part of Infosys' success story. He was said to be one of the main reasons for the company's good performance. contends she was subjected to verbal and visual sexual harassment and unwanted sexual advances. and insult that is 'sufficiently' severe or pervasive to alter the conditions of the victim's employment and create an abusive working environment. 30. Even within a country. the diverse socio-cultural environment of different countries complicates the matter. Phaneesh successfully set up the company's overseas businesses. who had been Mr. Murthy's executive assistant. upbringing and behavioral patterns of the people involved. Reportedly. Phaneesh joined Infosys. Though the law clearly defines sexual harassment. ridicule. Within three years. without encouragement from/being welcomed by the employee so as to create an abusive working environment and negatively affecting the employee's performance would fall under the purview of this form of harassment. Ms. he was the highest paid executive in the company with a take home package of Rs 20 million. In 1992. He was often called the 'other Murthy' of Infosys and had many admirers within and outside the company. Reka Maximovitch. Phaneesh became the head of sales at the company. Phaneesh graduated from one of India's premier business schools. an American citizen of Bulgarian descent. She also contends that the company failed to take reasonable steps to keep the harassment from occurring and recurring. then a $ 2 million company with a negligible presence in the US. Belonging to a middle-class South Indian family. Maximovitch. Phaneesh was working with another software company. While Chairman and Chief Mentor Narayana Murthy and a few others established Infosys in India back in 1981. . and in 1996. Not surprisingly. the exact nature of the incident depends on the attitude. any employee who indulges in speech or conduct of sexually discriminatory nature.

deal structuring and ongoing contract administration. payable in a month According to the complaint. "Murthy began subjecting the plaintiff to an ongoing campaign of sexual harassment and pressured her to engage in a sexual relationship with him. Maximovitch started working for Murthy around October 18." the lawsuit claimed. Even as uncertainty about the outcome of Reka's suit continued. In December 2002. sexual experience with Murthy. Says he is innocent and the company is not at risk 23 July 2002: Phaneesh quits 25 April 2003: Case settled out of court for $3 mn. Maximovitch alleges that it was a "do-it-or-else" situation for her from the word go.Timeline:        18 October 1999: Reka Maximovitch joins Infosys as Phaneesh Murthy’s assistant December 2000: Reka Maximovitch quits Infosys January-June 2001: Reka takes out two restraining orders against Phaneesh. to outsource consulting for clients and vendors. Phaneesh seemed to have moved on. She alleged that Murthy threatened to fire her if she did not comply with his advances. the services were to include partner/vendor selection. "Murthy repeatedly told the plaintiff that he answered to no one regarding how he ran the US offices. It was also reported that Phaneesh was planning to promote his own business process outsourcing (BPO) firm. Immediately after she took over her job. For fear of losing her job. Maximovitch said she "capitulated to Murthy's incessant advances and had a single. which she immediately regretted". For clients. 1999. of which she alleges at least one was violated 17 December 2001: Reka files a case against Phaneesh Murthy and Infosys for "sexual harassment and wrongful termination" January 2002: Phaneesh warns Nilekani of the possibility of a sexual harassment case against him and the organization. Phaneesh and his wife Jaya Murthy launched Primentor (in California). an advisory firm. the services were to include strategy consulting. for vendors. Media reports mentioned how many IT companies in India were trying to lure him to work for them. Infosys meanwhile issued a press release that categorically stated that Phaneesh would not be taken back after the case was settled. .

We have taken further steps to strengthen our internal processes and improve the checks and balances to handle similar situations. Nilekani and Mohandas Pai (among others). He did not tell me anything else about the relationship or the other matters of things being filed against the company. Nilekani said. Firstly. At the press conference. Recollecting the events. blueprints for the future. and account management training. Narayana Murthy did not answer a question about the fact that Reka did not seek redressal of her grievances through the company's internal systems. However." However. his refusal to answer did not necessarily mean that the company's internal systems were still not equipped to handle such problems. when the issue became more serious in June 2002 and Infosys was served a legal notice. Nilekani said that Phaneesh had first mentioned the lawsuit to him in January 2002.service definitions. portraying it as a very minor issue. Narayana Murthy said." Infosys conducted a course for all its officers and members (in India as well as abroad) on sexual harassment and the importance of being sensitized about the issue. Also. "We have conducted several training programs. In fact. the company's board stepped in. Narayana Murthy made it very clear that Phaneesh was very much a party to the settlement deal and that he had signed the documents himself. "He told me he was innocent and that the charge was without merit. Infosys had taken several measures to strengthen its grievance redressal procedures and had designed and implemented an effective sexual harassment policy. sales. At the press conference. Narayana Murthy. made public the entire sequence of events in the case. . widened the dissemination of information and met employees on this issue. The code of conduct provided in the employee manual was modified in line with the above decision. Infosys had reserved the right to proceed against him for his conduct and for the fact that he did not contribute financially to the settlement. "The litigation is behind us. brand consulting." Mohandas Pai added. and the company was not at risk.

and policy that forbids an employee in a supervisory role from dating a reporting employee and that details the steps required should a relationship form. it clearly was not the best solution. could be dealt with only if strict policies and guidelines regarding sexual harassment were established by the companies. this solution simply paid off the victim.  Instead of addressing the problem. so that the accused could walk away. Narayana Murthy said Infosys had taken further steps to strengthen its internal process and improve the checks and balances to handle similar situations. physical and financial damage caused to the victim. policy about how sexual harassment investigations are conducted in your company. . Infosys settled this matter because it believed it was in the best interests of the company to do so. Policies to Adopt to Prevent and Address Sexual Harassment:     sexual harassment policy. Infosys agreed to pay $3 million in an out of court settlement with Reka Maximovitch." Nilekani said. Lessons to be learned from this case  Though out-of-court settlements were the norm for most workplace sexual harassment suits the world over.Conclusion The lawsuit filed by the Reka against Phaneesh Murthy for sexually harassing her at the workplace. who had brought sexual harassment charges against Phaneesh. general harassment policy.  The larger issue of the emotional. "Besides checks and balances. then the company's director. we have made additional changes in the code of conduct and trying to explain what sexual harassment is and how to handle the situation. After the lawsuit the shares of Infosys has fallen down on the stock exchange. We have held training courses to all our management and other staff. The settlement between them was done out of the court. Since Infosys was considered to be one the ethical organisations in the country.

your response .  Take all complaints seriously. conduct training sessions for employees. Talk to them about the work environment. These sessions should teach employees what sexual harassment is.Strategies for Prevention There are a number of steps that you can take to reduce the risk of sexual harassment occurring in your workplace. Do you see any offensive posters or notes? Talk to your supervisors and managers about what is going on.  Train supervisors and managers. At least once a year. The sessions should educate the managers and supervisors about sexual harassment and explain how to deal with complaints.  Monitor your workplace. conduct training sessions for supervisors and managers that are separate from the employee sessions. review your complaint procedure. If the complaint turns out to be valid. act immediately to investigate the complaint. Get out among your employees periodically. see Nolo's article Guidelines for Handling Discrimination and Harassment Complaints. and o state that you will not tolerate retaliation against anyone who complains about sexual harassment.  Train employees. Keep the lines of communication open. and encourage employees to use it. Although you may not be able to take all of the steps listed below. That policy should: o define sexual harassment o state in no uncertain terms that you will not tolerate sexual harassment o state that you will discipline or fire any wrongdoers o set out a clear procedure for filing sexual harassment complaints o state that you will investigate fully any complaint that you receive. At least once a year. To learn more about dealing with employee complaints.  Adopt a clear sexual harassment policy. Look around the workplace itself. you should take as many of them as you can. If someone complains about sexual harassment. In your employee handbook. explain that employees have a right to a workplace free of sexual harassment. you should have a policy devoted to sexual harassment. Ask for their input.

see Nolo's article Guidelines for Handling Discrimination and Harassment Complaints. For more about dealing with complaints.should be swift and effective. .

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