TCS Distributes Quarterly Variable Pay

Tata Consultancy Services (TCS), India's premier IT services firm, has announced the distribution of 100% quarterly variable compensation to 70% of its employees. The remaining 30% received variable payments at reduced rates, reflecting their respective business units' performance.

Performance-Based Compensation: Employees in high-performing sectors like BFSI were granted full variable pay, whereas those in underperforming areas saw reduced payouts. This approach aligns with TCS's standard practice of linking compensation to business outcomes.

Salary Increase Postponement Considered

Amid economic uncertainties, TCS leadership deliberated on delaying the annual salary hike. A final decision is expected within the year, as stated by Milind Lakkad, Chief HR Officer.

Organizational Structure and Hiring

TCS's hierarchy spans from trainees to CXOs, with senior roles starting from C3B. The company, employing around 680,000, added 625 staff in Q1 and 6,433 in the fiscal year starting April 2024.

Financial Performance and Sector Impact

The first quarter saw TCS's net profit decline by 1.68% YoY, with operational revenue growing by 5.3%. Demand waned in key sectors, influenced by tariff implications.

Return-To-Office Policy: Last year, non-compliance with the RTO mandate affected some employees' variable pay, underscoring the importance of office attendance for full compensation eligibility.