TCS Variable Pay: Tata Consultancy Services (TCS) , the largest IT services company in India, would pay only 70 per cent of its employees variable pay in the second quarter of 2022. However, others would be paid variable pay depending on their ‘business unit’s performance’, the company announced during their latest earnings call on Monday.
“We are going to pay 100 per cent variable pay for 70 per cent of employees… the remaining 30 per cent will get paid based on their business unit performance. This is for Q2 (July-September),” said Milind Lakkad, chief human resource officer at TCS during the analyst conference call after announcing the company’s financials for the quarter ended September 30.
Variable pay, better understood as performance pay, depends primarily on the company’s performance. Interestingly, TCS reported Rs 10,431 crore net profit in the July-September quarter of 2022, crossing the Rs 10,000 crore mark for the first time in a quarter.
Rajesh Gopinathan, chief executive officer and managing director at TCS, said during the earnings call, “This was the milestone quarter for us as we crossed Rs 10,000 crore in net profit. On the financial perspective, it was a satisfying quarter.” He further added, “We closed the quarter on a strong note.”
It is worth noting that TCS had postponed the variable pay of some of their employees in the first quarter of the financial year as well. The variable pay for the April-June quarter was paid in August, as per an internal email circulated by the company.
While TCS had delayed variable pay in the previous quarter, IT companies like Wipro had deferred the same for employees in the C-band and Infosys had slashed it to 70 per cent.
The Mumbai-based IT major last month asked its employees to work from the office for at least three days a week. A third of its workforce of 6,16,171 people have returned to the office twice a week, the company stated on Monday.
The company also said that it has brought onboard 20,000 freshers this quarter, and “honoured” all the offers made amid a larger industry trend of delaying fresher joining due to a weak demand environment.
“Reflecting our culture of being committed to our employees, we have honored all the job offers we had made…” Lakkad said.
Meanwhile, TCS’ attrition rate jumped to 21.5 per cent compared to 19.7 per cent last quarter, however, the company pointed out that attrition will be on a “downward” trend from here on. “We believe our quarterly annualised attrition peaked in Q2 and should see it taper down from this point, while compensation expectations of experienced professionals moderate,” said Lakkad.
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