No Decision Yet On Salary Hike: TCS

Fri, 11 July 2025

10:21

Tata Consultancy Services on Thursday said it is yet to decide when it will provide salary hikes to its employees, as macroeconomic uncertainties intensified during the first quarter, leading to delayed deal closures and a drop in revenues.

India's largest information technology services provider by revenue will give an update on the timing and quantity of the hike when the situation improves.

"We have not made any decision so far on wage hikes. We will let you know as soon as we do," TCS Executive Vice-President and Chief Human resources officer Milind Lakkad said.

TCS's inability to hike salaries for its employees, a rarity in the industry, underscores the challenges that companies are facing due to geopolitical conflicts, supply chain problems, and ongoing trade deals, which investors are closely monitoring.

The company paused hikes in April due to macroeconomic uncertainty, which was further clouded by the tariff war between the US and other countries at that time. TCS expects to have more clarity on the economic environment once more countries start signing bilateral trade deals with the US.

The sluggish market has also dampened the company's ability to immediately absorb the 42,000 fresh engineering graduates it recruited last year. While some were hired, tougher business conditions towards the end of the first quarter have posed a hurdle.

"We will honour all the offers, and that process is done. How many and when they will come will depend on the business situation," Lakkad said.

TCS is sticking to its hiring target of 40,000 graduates from engineering colleges for FY 2025-2026, but this also depends on business performance, which may lead to a recalibration of the targets, he explained.

Attrition, which was low in the previous financial year, rose to 13.8 per cent during the first quarter. The company said it was making all efforts to bring it down again through employee engagement. It was 12.1 per cent a year earlier.

"It is more than our comfort level, which is between 11 and 13 per cent," he added. TCS added 5,090 employees during the first quarter, taking the tally to 613,069.

-- Avik Das, Business Standard

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