Tata Consultancy Services (TCS), India’s largest IT services provider, has reportedly implemented annual salary increases effective September 1.
Media reports said that most employees have received hikes between 4.5 and 7 per cent. Citing sources in the know, Moneycontrol reported that top performers, however, have been rewarded with double-digit increments exceeding 10 per cent.
Delayed Cycle Amid Global Uncertainty
Traditionally, TCS finalises wage hikes from April 1 every fiscal year. However, the current cycle was pushed back by more than a quarter due to a challenging business climate and global macroeconomic headwinds. Last month, the company announced that about 80 per cent of its workforce would see revised compensation this year.
While the company has not officially commented on the latest round of increments, earlier reports highlighted that eligible employees in junior-to-mid-level grades, up to C3A and equivalent positions, would be the primary beneficiaries of the latest hikes.
The decision aims to retain talent and reassure staff during a period marked by industry disruptions and slower client spending.
Focus on Majority of Workforce
Insiders revealed to the news organisation that the bulk of employees receiving hikes fall within junior and mid-level roles, which together account for the majority of TCS’s vast workforce. With more than 600,000 employees globally, the company has consistently emphasised career progression for associates at these levels.
The timing of the pay hikes comes as the IT sector grapples with margin pressures and changing demand patterns. By extending increments to the majority of its staff, TCS seeks to strike a balance between financial prudence and employee morale.
Layoffs Planned Alongside Salary Hikes
The news of pay hikes arrives just weeks after reports indicated that TCS plans to reduce its workforce by about 2 per cent – translating to over 12,200 employees – during fiscal year 2026. The layoffs, aimed at streamlining operations and enhancing agility, are expected to primarily affect mid- to senior-level professionals across geographies and business domains.
This dual approach underscores the company’s attempt to restructure for the future while continuing to invest in its talent base. Industry analysts believe the move highlights TCS’s strategy to align resources with emerging technologies while maintaining competitiveness.
