AgenciesAfter a delay of five months, India’s largest IT company, Tata Consultancy Services (TCS), has rolled out annual salary increments, with an average 4.5-7% raise, for the majority of its employees. The hikes are for the previous financial year, which ended March 2025, ET has learnt.
Additionally, high performers will receive payouts above 10%, people familiar with the development told ET.
It is understood to be among the lowest hikes offered in the last four years given the slowing business environment’s impact on the IT industry and TCS financials. While the average hikes were similar at 4.5-7% for FY24, it stood at 6-9% in FY23, and 10.5% in FY22.
Typically, the company rolls out the hikes in April.
The latest round of increments will be applicable starting September 1, for employees from the fresher level up to grade C3A, which comprise of junior to mid-level employees.
Senior-level employees in higher bands (C3B, C4, C5) are not included in the latest round of increases.
“The hikes will not be paid on a retrospective basis and will be received by employees starting from the September month salary rollout,” said one of the persons cited above.
Last month, ET reported that the Tata subsidiary will roll out salary hikes for 80% of its employees from September 1.
“We are pleased to announce a compensation revision for all eligible associates in grades up to C3A and equivalent, covering 80% of our workforce. This will be effective 1st September 2025,” read an email dated August 6, sent by TCS chief human resources officer (CHRO) Milind Lakkad and CHRO designate K Sudeep to employees.
The hikes come at a time when the company is in the process of laying off around 2% of its six-lakh workforce, translating into letting go over 12,000 mid- and senior-level staff in the ongoing fiscal year.
As of June end, TCS's total employee count stood at 613,069.
The current round of hikes also comes amid caution across the IT industry as Indian IT majors are facing muted revenue growth, delayed decision-making by clients, and concerns around the impact of tariffs and AI-led changes.
TCS also introduced a new bench policy in June that allows a maximum of 35 days annually without project allocation, with a target of 225 billed business days per year for each employee.
Additionally, ET reported that the Mumbai-headquartered company has frozen lateral hiring at the mid- and senior-level besides trimming hundreds of its benched staff in cities such as Chennai, Hyderabad, Pune, and Kolkata. The company has also faced criticism over delays in onboarding around 600 lateral hires.
The workforce developments have triggered a pushback from employees and unions. TCS has also been under the scrutiny of the Centre’s labour and employment ministry and Karnataka’s labour department following the developments.
Additionally, high performers will receive payouts above 10%, people familiar with the development told ET.
It is understood to be among the lowest hikes offered in the last four years given the slowing business environment’s impact on the IT industry and TCS financials. While the average hikes were similar at 4.5-7% for FY24, it stood at 6-9% in FY23, and 10.5% in FY22.
Typically, the company rolls out the hikes in April.
The latest round of increments will be applicable starting September 1, for employees from the fresher level up to grade C3A, which comprise of junior to mid-level employees.
Senior-level employees in higher bands (C3B, C4, C5) are not included in the latest round of increases.
“The hikes will not be paid on a retrospective basis and will be received by employees starting from the September month salary rollout,” said one of the persons cited above.
Last month, ET reported that the Tata subsidiary will roll out salary hikes for 80% of its employees from September 1.
“We are pleased to announce a compensation revision for all eligible associates in grades up to C3A and equivalent, covering 80% of our workforce. This will be effective 1st September 2025,” read an email dated August 6, sent by TCS chief human resources officer (CHRO) Milind Lakkad and CHRO designate K Sudeep to employees.
The hikes come at a time when the company is in the process of laying off around 2% of its six-lakh workforce, translating into letting go over 12,000 mid- and senior-level staff in the ongoing fiscal year.
As of June end, TCS's total employee count stood at 613,069.
The current round of hikes also comes amid caution across the IT industry as Indian IT majors are facing muted revenue growth, delayed decision-making by clients, and concerns around the impact of tariffs and AI-led changes.
TCS also introduced a new bench policy in June that allows a maximum of 35 days annually without project allocation, with a target of 225 billed business days per year for each employee.
Additionally, ET reported that the Mumbai-headquartered company has frozen lateral hiring at the mid- and senior-level besides trimming hundreds of its benched staff in cities such as Chennai, Hyderabad, Pune, and Kolkata. The company has also faced criticism over delays in onboarding around 600 lateral hires.
The workforce developments have triggered a pushback from employees and unions. TCS has also been under the scrutiny of the Centre’s labour and employment ministry and Karnataka’s labour department following the developments.
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