Last Updated:
Tata Consultancy Services announces upto 7% salary hikes for employees, favouring junior and mid-level staff, aiming to boost morale amid high attrition
TCS is aiming to boost morale among employees amid high attrition rates.
Tata Consultancy Services (TCS), the country’s largest IT services firm, has announced salary hikes for a significant portion of its employees, offering increments in the range of 4.5% to 7%. The revised pay packages were formally communicated through letters sent to employees late on Monday night, with the new salaries set to take effect from September, Moneycontrol reported.
The decision comes after months of uncertainty. Earlier this year, the company had indicated that salary hikes might be postponed due to unfavourable market conditions. The uncertainty deepened further when TCS laid off around 2% of its workforce, nearly 12,000 employees. Against this backdrop, the latest announcement has brought relief to nearly 80% of employees who will benefit from the increment.
According to media reports, the hikes have largely favored junior and mid-level staff, while top performers have received more generous raises, in some cases exceeding 10%. Industry observers see this as a strategic move by the company to retain talent and boost employee morale at a time when attrition remains a concern.
In its June-quarter earnings, TCS reported an attrition rate of 13.8%, highlighting the challenge of retaining skilled professionals in a competitive market. Analysts say that the salary hikes, particularly for high performers, could help reduce churn and reinforce loyalty among employees at a crucial juncture for the company.
The development is also being closely watched by the broader IT sector, which has been grappling with global demand slowdown, cost pressures, and workforce realignments. By opting for a hike instead of a freeze, TCS has signalled its intent to stabilise its workforce and send a message of confidence despite ongoing headwinds.
Read More
