India’s largest IT services firm, Tata Consultancy Services (TCS), has announced a wage revision for mid- to junior-level employees. This involves around 80 per cent of its workforce. The move comes even as the company is preparing to lay off approximately 12,000 staff, or 2% of its workforce, this year.
Pay Hike Email
The pay hikes, effective September 1, 2025, were communicated to employees via an internal email on Wednesday, August 6, by Chief Human Resources Officer Milind Lakkad and CHRO Designate K Sudeep.
“We are pleased to announce a compensation revision for all eligible associates in grades up to C3A and equivalent, covering 80 per cent of our workforce. This will be effective 1st September 2025," said the email, a copy of which was seen by PTI. It added, “We would like to thank each one of you for your dedication and hard work, as we build the future of TCS together."
TCS Layoffs
The decision to reward a large section of its employees follows TCS’s broader restructuring drive under which it plans to cut around 2 per cent of its global workforce, about 12,000 roles, mostly from middle and senior levels.
“TCS is on a journey to become a future-ready organisation. This includes strategic initiatives on multiple fronts, including investing in new-tech areas, entering new markets, deploying AI at scale for our clients and ourselves, deepening our partnerships, creating next-gen infrastructure, and realigning our workforce model," the company had said in a statement last month.
Re-Deployment Initiatives
It also noted, “Towards this, some reskilling and redeployment initiatives have been underway. As part of this journey, we will also be releasing associates from the organisation whose deployment may not be feasible."
Economic Uncertainty
India’s leading IT services players, including TCS, posted subdued single-digit revenue growth in the first quarter of FY26, as economic uncertainty and geopolitical tensions led to a slowdown in global tech spending and client decision-making.
US Tariffs
These layoffs have sparked conversations about a potential reset in the Indian IT sector, which is navigating global macroeconomic headwinds, disruptions from artificial intelligence, and the impact of protectionist trade measures like US tariffs on outsourcing.
