Tata Consultancy Services (TCS) has announced its annual salary increase, bringing good news for its employees. The company’s Chief Financial Officer, Samir Seksaria, stated that the salary hike went into effect on April 1st. The impact of this increase, amounting to 200 basis points, is reflected in TCS’s operating margin of 23.2%, which has been offset through improved efficiencies.
TCS Announces Salary Hike and Promotions, Focus on Workforce Utilization Instead of Aggressive Hiring
In its latest annual compensation review, TCS has provided a raise of 12-15% for exceptional performers and has also started the promotions cycle. However, the company indicated that it will not aggressively hire new employees this year. Instead, it plans to focus on utilizing the workforce it brought onboard last year. Milind Lakkad, the Chief HR Officer of TCS, mentioned that while the company remains committed to honoring all the offers it has made, the primary emphasis will be on leveraging the capacity built in the previous year.
High Attrition Expected to Stabilize in the Coming Months
During the three months ending in June, TCS hired only 523 new employees, bringing its total workforce to 615,000. This shift comes after a period of extensive hiring by IT companies over the past two years, as they struggled to cope with an unexpected surge in contracts from the US and European markets. The competition for talent resulted in high levels of attrition within the IT industry. However, Lakkad expressed optimism that the situation would return to normal by the second half of the current year. As of the end of June, attrition stood at 17.8% on a 12-month basis. He anticipated that attrition would continue to decline and eventually return to the company’s industry-leading, long-term range in the second half of the year
