Vanguard Reverses Course, Rehiring Hundreds of Workers Years After Controversial Outsourcing Deal
In a significant strategic reversal, Vanguard Group is bringing hundreds of jobs back in-house, effectively undoing a portion of a major outsourcing agreement signed with Infosys in 2020. The Malvern-based investment giant has confirmed that it will rehire nearly all of the employees currently facing layoffs at an Infosys subsidiary in Chesterbrook, Pennsylvania. This move comes almost six years after Vanguard transferred approximately 1,300 employees to the Indian technology firm in a bid to modernize its 401(k) record-keeping operations.
Details of the Reinstatement
According to a Worker Adjustment and Retraining Notification (WARN) filed with the Pennsylvania Department of Labor, Infosys is set to lay off 248 employees at its BPM Limited subsidiary between March 29 and September 30, 2026. Vanguard has intervened, offering positions to 96% of these affected workers. The rehiring initiative is focused on the same “client-facing” and “record-keeping” roles that were originally offloaded. The decision signals a retreat from the 2020 partnership’s structure, where Vanguard had hoped Infosys’s cloud-based platforms would revolutionize their service model. Instead, Vanguard is now reclaiming direct control over these functions to “improve the customer experience”—the exact same justification it used when outsourcing the jobs initially.
The Outsourcing Experiment and Corporate Objections
The reversal validates long-standing criticisms leveled by labor advocates and employees during the initial transition. In July 2020, when Vanguard first announced the partnership, the move was met with internal anxiety and external skepticism. Employees, referred to as “crew” by the company, were given an ultimatum: move to Infosys with a one-year guarantee of salary and benefits, or leave. At the time, critics warned that cultural clashes and service quality issues were inevitable when shifting sensitive retirement data management to a third-party global conglomerate.
While the current rehiring is a positive development for job security in the Philadelphia region, it raises uncomfortable questions about the efficiency of the initial decision. Industry observers note that the “lift and shift” model—transferring employees to a vendor only to bring them back years later—creates unnecessary volatility for the workforce. The years spent at Infosys meant that many of these workers were operating under different benefits structures and corporate cultures, only to be reintegrated into Vanguard’s system after the experiment failed to meet long-term expectations.
Background on the Vanguard-Infosys Partnership
Vanguard, which manages over $7 trillion in assets, originally partnered with Infosys to overhaul its legacy mainframe systems. The deal was one of the largest in Infosys’s history, valued at an estimated $1.5 billion. As part of the 2020 agreement, Martha King, then-head of Vanguard’s Institutional Investor Group, left the company to lead Infosys’s Mid-Atlantic operations, underscoring the depth of the collaboration. Infosys had promised to establish a “center of excellence” in the region, aimed at serving not just Vanguard but other financial institutions. The return of these jobs to Vanguard suggests that while the technological upgrades may have been implemented, the service component required the direct oversight that only in-house teams could provide.
vista.today
inquirer.com
