One graphic that explains why TCS doled out Rs 2,628 cr bonanza for staff

Tata Consultancy Services, the country’s largest software exporter, yesterday said it will dole out Rs 2,628 crore in bonus to its 3 lakh-plus employees. The big number has given rise to much excitment primarily because the company is known as a stingy employer. So why this generosity now? [caption id=“attachment_2201056” align=“alignleft” width=“380”] Reuters[/caption] The company has said that it is a one-time bonus or a special reward to its staff on the occassion of the 10th anniversary of the listing of the company. But is that the only reason? Very unlikely. You just need to take a look at the graphic below to find another valid reason. As the graphic shows, the company’s attrition in Jan-March stood at at 14.9 percent. The key employee metric, which helps measure the employee satisfaction in a company, has been rising in the last few quarters. It has crossed the previous high of 14.8 percent recorded in April-June of 2011-12. It is actually the highest at least in the last six years. At a time when the company is bullish about its business prospects, it would want to rein in its employee churn, which also must have prompted the company to roll out the goodies. The company has also given a salary increase of average 8 percent for the staff in India and 2-4 percent for the overseas employees. Kotak Institutional Equities has termed this as healthy and points out that it is a “high for the second consecutive year”. The move could also be seen as an image makeover effort by the company, which had experienced bad press earlier this year after it sacked about 2500 senior and mid-level staff. The company management has admitted that the increase in attrition is serious but downplayed the concern. Top officials of the company told CNBC-TV18 today morning that whenever demand in the IT sector picks up, attrition goes up. “Look at the job market. There are phenomenal opportnities,” said Ajoy Mukherjee, executive vice-president and global head (human resources). “We are focussed on bringing down the attrition,” CEO N Chandrasekaran told the TV channel. Data inputs by Kishor Kadam