On Tuesday morning, several thousand employees of Oracle, a US based tech giant, woke up to an email in their inbox, announcing their exit from the company.

According to media reports, Oracle has laid off around 18% of its global workforce of 162,000 employees as the company accelerates its adoption of artificial intelligence (AI).

India appears to have been among the hardest-hit markets. According to media reports, over 12,000 India-based Oracle employees, including entire teams, were laid off, with Hyderabad in Telangana taking the maximum hit as it hosts the company’s largest workspace in the country.

Oracle has announced a severance package for its laid-off employees. In India, global companies typically provide a Notice Period (N) + 2 months package. Under Section 17(3) of the Income Tax Act, severance pay is treated as “profits in lieu of salary” and is generally taxable. For employees whose total taxable income exceeds ₹15 lakh, most of the severance amount is likely to be taxed at the 30% slab, along with applicable cess.

Former MP and Telangana Jagruthi president Kavitha Kalvakuntla has now demanded a one-time income tax waiver on the severance paid to laid-off Oracle employees, arguing that families facing sudden job losses should not be further burdened.

In an exclusive interview with AI FrontPage editor Vaibhav Jha, Kavitha announces her campaign to help distressed laid off employees of Oracle and discusses AI related job disruptions in India and the need for urgent policy based intervention.

Question: Several laid-off Oracle employees have alleged that the company did not follow its usual exit process. Do you believe there should be an official inquiry into whether labour laws and due process were followed?

Kavitha:  One aspect of this deeply concerning trend is the role of the government in supporting those impacted by large-scale layoffs. The other is ensuring strict compliance with labour laws—whether due process, notice requirements, and compensation norms have been properly followed…We are receiving reports from affected employees alleging that established procedures may not have been fully adhered to. These concerns must be examined seriously and transparently.”

Question: These are unprecedented times when the global workforce is being impacted by AI. What can be the role of opposition to ensure that employees are treated fairly by companies, when pitched against automation?

Kavitha: We will stand firmly with those impacted during this difficult period and work to ensure that their grievances are heard and addressed. Through this forum, I urge affected professionals to reach out to us via social media or email at feedback@jagruthi.org. I will personally take up these concerns with the IT Minister of Telangana, and if required, escalate the matter to the Union Government. The livelihoods of thousands of families are at stake—and this cannot be ignored.”

Question : Should the central government and Telangana government introduce a special framework to track AI displaced jobs?

Kavitha: To begin with, we are already behind the curve. The pace at which AI is transforming industries has outstripped policy preparedness—both at the state and central levels. There is an urgent need for a dedicated framework to address AI-driven job displacement, built on three pillars- National & State-Level Tracking Mechanism, Social Protection & Transition Support and Preventive Policy through industry engagement.”

Question: Could you explain the three pillars?

Kavitha: There is an urgent need to have a structured database to track displaced professionals—categorised by skill, experience, and sector—so they can be efficiently matched with emerging opportunities. We must have targeted policy support for affected families, including temporary income support, reskilling programs, and job transition assistance. And there must be consultations with industry leaders to anticipate workforce shifts, encourage responsible AI adoption, and create early-warning systems to minimise sudden job losses.”

Question: Under the Income Tax Act, severance packages are generally taxable, with limited exemptions in certain cases. Do you believe the Centre should consider a temporary waiver or relief for employees affected by mass layoffs?

Kavitha: These are individuals who have contributed to the economy and paid taxes consistently throughout their careers. At a time when they are facing sudden job loss and financial uncertainty, taxing severance—raises serious concerns of fairness and timing. While current tax laws do provide partial exemptions depending on how severance is structured, there is a strong case for a one-time, targeted relief measure for those impacted by mass layoffs of this nature. I urge the Union Finance Minister to examine this issue and consider a temporary exemption or enhanced relief, ensuring that affected families retain maximum financial support during their transition.”

Also Read: India’s Youth Unemployment Crisis to Worsen with AI: Report