News : Proposed Legislation Could Hurt Convergys, Other Call Center Operators
Dec 23, 2011 -- The measure would bar American companies from receiving federal grants or guaranteed loans for several years after they relocate call centers to locations abroad. And each time they made such a move, they’d have to report it to the U.S. Secretary of Labor, who would maintain a publicly available list of companies who have done so.
Failure to make the report at least 120 days prior to the outsourcing move would face penalties of $10,000 per day.
Downtown-based Convergys employs 70,000 people in 68 contact centers serving industries such as financial services, pharmaceuticals and e-commerce. More than 25,000 of the workers are in the Philippines and more than 11,000 are in India.
The bill was introduced Dec. 7 by U.S. Reps. Tim Bishop (D-New York) and U.S. Rep. David McKinley (R-West Virginia). It has the support of the Communications Workers of America union, which represents 700,000 U.S. telecommunications and customer service employees, columnist Peter Bernstein wrote for the call center industry site Contact Center Solutions Community.
The legislation, called the U.S. Call Center Worker and Consumer Protection Act, H.R. 3596, has been referred to committee. It faces opposition in India, where the call center industry, also known as the business process outsourcing or BPO sector, is a $14 billion-a-year market, according to the Times of India.
Indian officials will "raise the issue at appropriate intergovernmental fora and bilaterally through the US administration," the newspaper quoted Nirupama Rao, India’s ambassador to the U.S., as saying. "We will also look at the political context in which the bill has been raised and are conscious of safeguarding trade and investment interests of the Indian industry, including the IT industry, in the US market."
Convergys competitors such as Nashville, Tenn.-based Sitel could also be affected by the legislation, as could units of companies such as Minnetonka, Minn.-based UnitedHealthcare Group, noted the Economic Times, another Indian newspaper.
"It’s clearly a protectionist bill," Ameet Nivsarkar, vice president at the Indian IT trade organization Nasscom, told the Economic Times.
Posted by Veronica Silva Cusi, news correspondent
Convergys Corporation is a global provider in relationship management. We provide solutions that drive more value from the relationships our clients have with their customers and employees. Convergys turns these everyday interactions into a source of profit and strategic advantage for our clients. For more than 30 years, our unique combination of domain expertise, operational excellence, and innovative technologies has delivered process improvement and actionable business insight to clients that now span more than 70 countries and 35 languages. Convergys, a Fortune Most Admired Company for nine consecutive years, has approximately 70,000 employees in 82 customer contact centers and other facilities in the United States, Canada, Latin America, Europe, the Middle East, and Asia, and our global headquarters in Cincinnati, Ohio.
Published: Tuesday, December 27, 2011