TCS announces salary hikes! India’s biggest IT services provider, Tata Consultancy Services (TCS), has announced yearly salary hikes after a five-month postponement, offering most staff members raises between 4.5-7%. These increments correspond to the previous fiscal year ending March 2025. The organisation traditionally distributes salary hikes in April.Sources informed ET that exceptional performers will receive hikes exceeding 10%. This salary revision coincides with TCS’s plans to reduce approximately 2% of its workforce, affecting over 12,000 mid and senior-level personnel during the financial year ending March 2026.The company’s workforce numbered 613,069 at the close of June.
TCS rolls out salary hikes
The current salary hikes are reportedly amongst the lowest in recent years, reflecting the challenging business climate affecting the IT sector and TCS’s financial performance. Whilst FY24 saw similar increases of 4.5-7%, FY23 offered 6-9%, and FY22 provided 10.5%.The current increment cycle, effective September 1, applies to staff ranging from freshers to grade C3A, encompassing entry-level to middle-management positions.Higher-ranked employees in bands C3B, C4, and C5 are excluded from this 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 roll out,” a source told ET.In August, it was reported that the Tata unit would implement salary increases for 80% of its staff starting September 1, 2025.“We are pleased to announce a compensation revision for all eligible associates in grades upto C3A and equivalent, covering 80% of our workforce. This will be effective 1st September 2025,” stated an email from TCS chief human resources officer (CHRO) Milind Lakkad and CHRO designate K Sudeep to employees on August 6.These salary hikes come amidst the IT sector experiencing cautious sentiment, with Indian IT companies facing subdued revenue growth, client hesitation in decision-making, and uncertainties regarding tariff impacts and AI-driven transformations.In June, TCS implemented revised bench guidelines allowing staff 35 days annually without project allocation, whilst setting a target of 225 billable business days yearly per employee.The organisation, based in Mumbai, has also suspended mid and senior-level lateral recruitment and reduced non-allocated staff across various cities including Chennai, Hyderabad, Pune, and Kolkata. The firm faces questions regarding delays in incorporating approximately 600 lateral recruits.
