TCS Salary Hike: Good News? Tata's IT Behemoth May Hike Employees Salaries By 4-8%; Infosys To Give 5-8% Hike

TCS Salary Hike: Tata Consultancy Services (TCS), India's largest IT company that is backed by Tata Group, has reportedly announced to implementation of annual salary hikes in the range of 4% to 8%. TCS is expected to increase its employees' salaries in March for FY25, while disbursements are expected to take place at the start of April. On the other hand, Infosys is reportedly going to implement 5% to 8% annual salary increases.

A staff member of TCS told ET that the company has conveyed to its employees about 4-8% hikes. The staff added, "The business verticals which have done well typically get more hikes but overall increments have not been too good."

The upcoming annual salary increase is far lower than compared to the 7% to 9% average hike in FY24 by TCS. Back in FY22, the company announced a 10.5% average salary hike.

Furthermore, the report highlighted that the upcoming hike followed February's quarterly variable payouts to the employees from October to December 2024 (Q3FY25), with senior staff members getting reduced pay between 20% and 40%.

The grade hierarchy in TCS comprises Y (trainees), C1 (systems engineers), C2, C3 - A&B, C4, C5, and CXOs. C3 grade and above is basically for senior-level employees. As per the report, about 7% of the staff, especially those belonging to C3 grade and below, have received full variable pay.

On the other hand, the second-largest Indian IT company, Infosys, has reportedly declared to hike employees' annual salaries by 5% to 8%. The increments are expected to be distributed before March 2025 ends.

During the Q3FY25 quarter, the total headcount of TCS was fewer by 5,680 employees compared to 608,985 as of September 30, 2023. On year-on-year, TCS let go of 10,669 employees as against the headcount of 613,974 employees as of December 2022. In Q3FY23, TCS's headcount declined by 2,197 employees.

Meanwhile, the company's IT services' attrition was at 13.3% for the last twelve months. This is lower compared to the attrition rate of 14.9% in Q2FY24 and 21.3% in Q3FY23.

In January month, Milind Lakkad, Chief HR Officer of TCS said, "We are committed to hiring from college campuses and growing talent organically. We have commenced our campus hiring process for the next year and see tremendous excitement among freshers to join TCS."

As per the latest update, TCS is on track to meet its 40,000 freshers hiring target for FY25, while it increased the target for FY26.

It is being said that over the recent years, IT companies have lowered the salary hikes quantum to single-digit from the double-digit era during growth period of Covid-19.