Tata Consultancy Services (TCS), the leading software services exporter, has announced its annual salary hike for its employees, bringing good news to its workforce.
TCS CFO Samir Seksaria stated, “We have gone ahead and rolled out our annual salary increase with effect from April 1st. Our operating margin of 23.2% reflects the 200-bps impact of this hike, offset through improved efficiencies.”
As part of the latest annual compensation review, the company has provided a 12-15% raise for exceptional performers and has also commenced the promotions cycle.
On the hiring front, TCS indicated that it will not be as aggressive in hiring this year and will instead focus on utilizing the workforce it onboarded last year.
“While we are committed to honoring all the offers we have made, our focus will be on leveraging the capacity we built last year,” said Milind Lakkad, Chief HR Officer of the company.
During the three months ending in June, TCS net hired 523 new employees, bringing its total workforce to 6.15 lakh.
This decision comes after the unprecedented hiring spree in the IT industry over the past two years, as companies struggled to meet the increased demand from the US and European markets.
The intense competition for talent resulted in high levels of attrition in the IT industry. However, Lakkad mentioned that the situation is expected to normalize in the second half of the current year. As of the end of June, TCS reported an attrition rate of 17.8% on a 12-month basis.
“Our attrition continues to trend down, and we expect it to be back in our industry-leading, long-term range in the second half of the year,” Lakkad added.
With the annual salary hike and focus on optimizing their existing workforce, TCS aims to maintain its position as a leading IT company while ensuring employee satisfaction and retention.
