In a significant move to bring employees back to the office, Tata Consultancy Services (TCS) introduced a policy linking quarterly variable pay to in-office attendance. This strategy, implemented in April 2024, has successfully resulted in almost 70% of work-from-home (WFH) employees returning to the office.
The New Policy Explained
TCS’s Chief HR Officer, Milind Lakkad, announced that employees with less than 60% attendance in the office would not be eligible for the quarterly bonus. The policy mandates a minimum of 85% attendance in the office to receive the full variable pay. Employees with 75-85% attendance will receive 75% of their variable pay, while those with 60-75% attendance will get 50%.
This policy change follows another update requiring employees to work from the office five days a week. By linking financial incentives to physical presence, TCS aimed to encourage more employees to return to the office environment.
The Impact on Employee Attendance
The introduction of this policy has led to a notable increase in office attendance. Milind Lakkad stated, “Today almost 70% of our employees are back in the office. I am not too much worried about the quantum or number of people not coming to the office and getting affected by this. This number is increasing every week.”
Lakkad highlighted that many employees, especially those who joined during the pandemic, were experiencing the office environment for the first time. He emphasized that the initiative should be seen positively and as a temporary measure.
Financial Performance and Employee Adaptation
Despite the changes, TCS reported a strong financial performance in Q1 2024-25. The company saw a 9% year-on-year increase in net profit, amounting to ₹12,040 crore, and a 5.4% rise in revenue from operations, totaling ₹62,613 crore.
The policy’s success indicates that employees are gradually adapting to the new normal, recognizing the value of in-office interactions and the professional growth opportunities they bring. TCS remains optimistic that this trend will continue, with more employees returning to the office each week.
