TCS to roll out hikes for majority of staff from Sept 1
This comes at a time when many of its peers have either deferred salary hikes or placed them on hold.
The salary hike will be effective from Sept 1, according to an internal communication sent out by CHRO Milind Lakkad and CHRO-designate K Sudeep on Wednesday. When TOI reached out to TCS, the company said, "We can confirm that we will be issuing wage hikes to around 80% of our employees effective Sept 1, 2025."
During the April earnings presser, TCS indicated that it might have to defer its annual increments, a rare deviation from its April cycle, coinciding with clients' downbeat sentiment emerging from a slowdown and tariff-related uncertainty.
Even in the June quarter earnings, Lakkad said the company has not made any decision yet regarding wage hikes. TCS's June quarter results reflected lacklustre performance attributed to weak macroeconomic conditions, cautious client sentiment, delayed decision-making, and the winding down of the BSNL deal.
Its revenue for the June quarter fell 3.1% year-on-year in constant currency and 3.3% sequentially, as geopolitical uncertainties dampened demand.
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Last year, TCS implemented salary hikes ranging from 4.5% to 7% for its associates, with high performers receiving double-digit increases. However, the company has not disclosed the average hike in its communication. News of this year's salary increase comes amid a challenging period marked by cautious client spending and delayed decisions in key markets like the US and Europe. Nevertheless, the company remains optimistic about a turnaround, anticipating stronger demand in the second half of the year.
Indian IT CEOs have adopted a cautious tone in their commentary on wage hikes. When TOI asked Infosys CEO Salil Parekh about the timelines for wage hikes, he said, "We concluded our compensation increases for Q4 and Q1 of the last fiscal year….Now that this cycle is complete, we are beginning to evaluate the timing for the next round—as we do after every cycle. During Covid, the standard cycle was disrupted, leading to two increases over 18 months.
There are no changes planned. We will stick with our existing process and announce the next cycle at the right time."
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