PHANEESH MURTHY SEXUAL HARASSMENT CASE

BY FEBA JOSE
MBA S3
ROLL.NO 28
 SUMMARY
Infosys is provider of technology, engineering and outsourcing services.

Infosys was co-founded in 1981 by N. R.Narayana Murthy, Nandan Nilekani and other
management partners

 Its headquartered in Bangalore. It has offices in 30 countries

Today, Infosys is a global leader in the "next generation" of IT and consulting with revenues of
billion

Infosys ranked among the most innovative companies in a Forbes survey

 About Phaneesh Murthy

•Phaneesh murthy 38 years old man, the head of sales

and marketing and communication and product services division of Infosys

•Phaneesh Murthy, the highest-paid employee of Infosys, he used to take

Rs.1.91 crore every year.
 About Reka Maximovitch

Reka Maximovitch, an American citizen of Bulgarian descent.

Reka Maximovitch was working as Phaneesh Murthy's executive assistant.

While she was facing sexual harassment from Murthy from October 1999 she was not reported, may
be due to fear of social ridicule or fear of losing her job.

She was wrongfully terminated from job in Dec’2000.

 Problems Identified
•Reka filed a complaint in Oakland,USA on 17 Dec', alleging sexual harassment, unlawful termination
against Phaneesh murthy.

•Infosys became entangled in the scandal, it is the first negative news about Infosys since its inception.

•Murthy abruptly resigned from Infosys.Initially,Murthy refused to participate in the settlement

initiated by Infosys.

•Infosys ahead with the settlement without any contribution from murthy.

•Later on, He voluntarily signed the settlement and agreed to every condition that Infosys had set.
•Lack of corporate governance

•Infosys maintained a studied silence on the episode on the ground that the matter was subjudice.

•Media reports blamed Infosys for having kept the issue under wraps for a long time.

•The Company’s share price declined by 6.6percent soon after phaneesh left
 Solution

•Giving details of the settlement, Infosys chairman and chief mentor N R Narayana Murthy told media
persons that the company would be paying $3million to the accuser.

•Of this, Infosys would contribute $1.5 million and the balance $1.5million was contributed by the
insurers under the company's directors and officers liability insurance cover.
 INFOSYS POLICY ON SEXUAL
HARASSMENT
•Anti- sexual harassment Initiative (ASHI).

•Encourage employee to report unethical behaviour under whistle blower policy.

•Independent (non-Infosys) grievance redressal body and procedure.

• The redressal body consists of an independent chair person who is a lady, as required by the Supreme Court
guidelines and four committee members who are employees.

•As a part of the training process all officers and board members have been given a course on the prevention of
sexual harassment. 
 QUESTION
1. Even in organization known for the best ethical culture, ethical infractions could
happen, if proper, adequate and acceptable work practices are not put in place,
anticipating human facilities. Discuss this in context of phnaneesh murthy case at Infosys.

This was unethical. Even in organisations like Infosys, which is known for its best ethical
culture and had strict policies for such harassments, the things went wrong. Event though
out of court settlements are valid in some work places, but case like sexual harassment, it
was clearly unethical & not the best solution. Instead of clearly addressing, the problem,
this solution simply paid off 3 million to the victim (Rekha) , so the defendant
(Phaneesh) could walk away. This could be dealt with other solutions which you will be
 How to overcome
Even though there are policies for sexual harassment such disturbing cases happen to overcome this
difficulty
Employer’s role

- CREATE SEXUAL HARASSMENT POLICY

- COMMUNICATE THE POLICY
- EXECUTE ACCORDING TO THE POLICY
- MAKE A GREIVIENCE CELL
- TRAINING THE EMPLOYEES
 How to overcome
EMPLOYEE’S OR VICTIM’S ROLE:
- COMMUNICATE THE PROBLEM
- FORMAL AND OFFICIAL REPORTING
-CREATE WITNESS
- SET BOUNDARIES

“THE ORGANISATION AS A WHOLE HAS TO WORK TO ERADICATE THIS PROBLEM OF SEXUAL

HARASSMENT”
HMSI – HONDA MOTORCYCLE
AND SCOOTERS INDIA LIMITED
Better Wages Cannot Suppress
Workers’ Demand For Their Rights
SUMMARY
• The case study focuses on the HR problems faced by Honda Motor Cycle &
Scooters India (HMSI). The case discusses the various reasons which led to the
dispute between the management and employees of HMSI.

• It elaborates the incidents, which led to the strike at the company that resulted in
HMSI workers being severely beaten up by the police.

• Labour strike and the management's inability to deal with it effectively had resulted
in huge losses for the company due to the fall in the production level at the plant

• In addition to this, the company also received a lot of negative publicity as

newspapers and TV channels gave wide coverage to the violence of the action.
Problems Identified

• The high workload, stressfull work schedule , rampart discrimination, lack of

environment chanels with the top management and hard personnel policy
practiced by the company , militataed against companies interest.

• Ill treatment of workers at the factory.

• The line managers practice of denying them even nature breaks, leave or
work flexibility

• The company also received a lot of negative publicity.

• Understand the factors that lead to labour unrest at a factory and the impact
of such incidents on the employees and the company.

• Study HR policies adopted by organizations to prevent labour unrest at the

workplace.

• Examine top management's role in maintaining a peaceful working

environment.

• Analyze the role of external parties such as trade unions; political parties
etc., in disturbing the working environment in a company
ALTERNATIVES :

• Management should realize the fact that even If the workers are paid
attractive salaries , management should not take workers for granted and
ignore their legitimate grivances.

• Should develop a trust and confidence among workers in their own

interest.

• Adopt a participate type of administration in which workers are made to

share leadership with mangers.

• Mangement should communicate with employees their concerns on issues

that affect them.

• To strengthen the HR department with a senior manager and intensified

the training programme.
SOLUTION

• HR deparment tried to build up interenal cohesion within the management

and improved the managers sensivity towared employees through training.

• The company also nominated a committee of seven representatives of

workers to bring to the notice of the management, the union workers’s
grivances.
Questions:
1. Explain in the context of HMSI case how better wages and perquistes alone cannot
supress forever, the workers demand for the exercise of their legitimate rights.
Industrialist and managers should realize the fact that even if the workers are
paid attractive salaries and generous perquisites, management should not take workers
for granted and ignore their legitimate grievances.
– It is a poor understanding of human psychology to assume that workers would sign
away their freedom, dignity and self respect for a fat pay packet.
– Management have a responsibility to develop trust and confidence among workers in
their own ineterest. when they express a desire to articulate their problems to protect
their interests, management should view it as workers legitimate right.
2. Discuss briefly the HMSI case and the reasons for the failure of the strategy
adopted by the management to contain the workers agitataion to secure their rights .

– Management fail to communicate with employees their concerns on issues that

affect them .
– When the workers are in the dark about the proceedings in the organization that
affect them, and with a lot rumours spreading in the absence of verifiable
information, it is likely to cause dissatisfaction and disturbance.