TCS announces massive salary hike after increasing 8% net profit in previous quarter, details here

Tata Consultancy Service has come up with an exciting announcement for its employees amid the winter holiday celebrations. The company is giving a 20 percent salary hike to 70 percent of employees while the remaining portion will receive an increment based on their performance. Currently, there are almost 6 lakh people working with the TCS. Among them, almost 4 lakh employees will be awarded incentives in the form of 100 percent variable pay beginning in the financial year 2022. Variable pay presently makes up 10 percent to 20 percent of an employee’s salary.

After the business’s quarterly results were released publicly on 26 December, Milind Lakkad, the chief human resources officer, announced the initiative. He revealed that the turnover rate peaked in the second quarter and then quickly dropped off after that. The company’s net profit for the preceding quarter reportedly increased by 8 percent, reaching over Rs 10,000 crore.

Lakkad stated that the company will pay all of the variables to 70 percent of its employees. The remaining 30 percent of workers’ remuneration will be made up of performance-based payment.

As the attrition rate in the IT industry lowers, hiring has become sluggish. The company’s average attrition rate is currently 19.7 percent, down from 21.5 percent recorded in the previous year. TCS recruited 20,000 new employees between July and September, increasing the total number of hires in 2022 to 35,000. It was previously announced that the company would hire 40,000 recent graduates. However, according to Lakkad, TCS is actively seeking new graduates irrespective of the fact that the IT industry as a whole has had difficulty matching job vacancies.

TCS, Wipro, and Infosys, rivals in the first quarter, all reduced variable pay for their staff. At Wipro, junior employees get only 70 percent of the variable compensation that senior officers receive. Infosys adopted a similar policy, capping overall employee compensation at 70 percent of the previous level.

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