TCS announces 100% variable pay for majority of staff

India’s largest IT services company, Tata Consultancy Services (TCS), has announced 100% variable pay for 70% of its employee base for the quarter ended September.

The variable payout for the remaining employees will be based on their business unit’s performance, said chief human resources officer Milind Lakkad.

TCS released 100% variable pay in the first quarter of this fiscal year as well.

The company on Wednesday reported 9% year-on-year (YoY) growth in consolidated net profit to Rs 11,342 crore in the quarter ended September. Consolidated revenue grew nearly 8% on year to Rs 59,692 crore. The board recommended a second interim dividend of Rs 9 per share and approved a share buyback of Rs 17,000 crore.

Work from office

The company has also asked employees to come back to the office full-time. ET reported last month that multiple teams across TCS have been informally told to return to the office for five days of the week, starting October 1.

“We strongly believe they need to come to work so the new workforce gets integrated with the larger workforce. That is the only way they will learn, understand and internalise TCS values and the TCS way. Having said that, we will continue to assess the work models and evolve depending on what works best for our customers and employees,” Lakkad said.

ET had reported on October 3 that leading IT companies in India, including Wipro, Capgemini and LTIMindtree, are asking employees to work from office on all or at least 50% of the working days in a week,

Employee headcount falls

TCS’s headcount saw a net fall of 6,393 employees in Q2 of FY24, taking the overall headcount to 608,985. Further, the headcount was down by 7,186 from the year-ago period.

The company had added around 523 employees sequentially in Q1. Voluntary attrition for the quarter stood at 14.9% compared with 17.8% last quarter and the company said further improvements would be seen in the metric.