EPAM will reduce its presence in the region of Ukraine, Belarus and Russia to 30%. How will this affect employees

EPAM CEO Arkady Dobkin predicts that the company's presence in the region, which includes Ukraine, Belarus and Russia, will decrease to 30% of the total number of specialists by the end of the year. He stated this during a conversation with investors in May. But this does not mean the dismissal of Ukrainian employees. DOU explains what the company will do in practice.

What happened on May 31, a number of media outlets reported that EPAM plans to reduce the staff in Belarus and Ukraine by at least 6 thousand specialists by the end of 2022. The media drew conclusions based on the communication of EPAM CEO Arkady Dobkin with investors in early May.

"Before COVID, our share [of presence] in Ukraine, Belarus and Russia was about 70% of the total production capacity. By the end of 2021, it was less than 60%. We believe that by the end of 2022 we will be able to reduce the placement of our production in the region to about 30%," said Arkady Dobkin.

Taking data from the total number of employees, the media estimated that by the end of the year, the company plans to reduce its production staff in the region by almost 15 thousand people. And at least 6 thousand employees will be relocated from Belarus and Ukraine until the end of 2022.

In a comment by DOU Corporate Communication Director of EPAM Ukraine, Nina Vasilyova said that the media calculations made are incorrect. The market presence will be reduced, in particular, because the company will lay off some of the production specialists who worked in Russia and Belarus.

"During a conversation with investors, Arkady [Dobkin] made a forecast to reduce the share of the region, which includes Ukraine, Belarus and Russia, to 30% of the total number of specialists at the end of the year. This will be due both to a decrease in the number of production specialists in the region (at the expense of Russia and Belarus), and due to the rapid growth of other EPAM locations in the world. His words were misinterpreted and some media outlets conducted their own calculations using data on the number of specialists over the past year," Nina Vasilyeva explained.

She also added that there are no plans to reduce the team in Ukraine. Now EPAM Ukraine resumes hiring specialists and training students on external programs of EPAM University.

"The Ukrainian team works at the level of pre-war productivity. During the full-scale Russian invasion of Ukraine, we evacuated about 2.5 thousand specialists abroad. Now some people have already returned to Ukraine, some are just planning to return and some may remain abroad, but now it is too early to talk about any specific figures," she said.

During a conversation with investors, Arkady Dobkin noted that today most of the company's employees and offices are located in Europe, West and Central Asia. But the company wants to identify a number of specific countries where it can scale.

"Over the past 12 months, the fastest growing markets for us have been India and Latin America. They will be the center of attention, and we will complement the new development centers and existing ones in Europe with our talent reallocated from traditional locations," added the CEO of EPAM.

What is happening with EPAM offices in Russia and Belarus the exit of EPAM from Russia and Belarus did not happen instantly, which caused negative comments in the direction of the company. In an interview with DOU in May, Vice President and head of the central-eastern region of EPAM Yuri Antonyuk explained what this was connected with.

"We did not delay with the decision and actually said in the first few days that we were stopping working with Russian clients. But why do they say that EPAM was delayed until April? If we had 100 people, we would have stopped it in the first week, but we have thousands of employees there. And [if we stopped everything immediately], there would be problems at the international level with the courts, we would be forced to pay millions of dollars more to Russia," he said.

Yuriy Antonyuk also added that the company simply did not know how to do this in the first week, from a legal and legislative point of view, so that there would be no problems.

In addition, in March, an employee of EPAM's Moscow office anonymously told DOU that work with Russian clients was indeed being completed and they were being offered to hire people from EPAM who worked on their projects.

"Cooperation with Russian clients is coming to an end — there are release dates for each project, new initiatives are not being worked out. But EPAM can't leave customers and employees out of work. Therefore, now clients receive an offer to hire people with whom they have worked. The main task is to complete all obligations to customers in the shortest possible time, not to "fill up" their business with a sharp exit. For example, my client suffered because of a vendor who also left the Russian Federation. We preserve the product, backlog, analytics — we pass it on to the client," he explained.