New labour codes hit IT sector profits
Even as artificial intelligence-led deal wins supported revenue growth for India’s top information technology (IT) firms in the December quarter, profits have taken a hit due to the implementation of new labour codes.
Tata Consultancy Services (TCS), India’s largest IT services firm, reported a Rs 2,128-crore hit to profit during the quarter as employee-cost rose due to the new labour codes. This included Rs1,816 crore for additional gratuity costs and Rs 312 crore for long-term compensated absences after India’s new labour codes came into effect on November 21.
