The country's third largest software exporter Wipro today said it will hike salaries for its employees in India by 12-15% as it looks to counter high attrition.
The wage hike, effective June 1, will be to the tune of 2-4% for onsite staff (at the customer site).
Announcing Q4 2010-11 results, the company said wage hike will impact its operating margins in the first quarter this fiscal.
Wipro, which has been competing with domestic and global rivals like Tata Consultancy Services and IBM, has witnessed high levels of attrition over the last few quarters.
"We have announced wage hikes effective June 1, 2011, which would have an impact on the operating margins... It will be 12-15% for offshore and 2-4% for onsite employees," Wipro Executive Director and Chief Financial Officer Suresh Senapaty said.
Wipro added 2,894 people in the IT services vertical during the quarter ended March 31, 2011, and 14,314 people during the year. It had 1,22,385 employees as of March 31, 2011.
"Is it (attrition rate) comfortable, it is not... However, we have been able to bring down the attrition through the year. When you go back a couple of quarters, we were at a level which was north of 23.5% and from there, we have been able to bring it closer to about 20%," Wipro Human Resources Vice-President Pratik Kumar said.
Kumar added that voluntary attrition came down to 20.9% in Q4, FY11, from 21.7% in the preceding quarter.
Rival TCS had said it plans to hike wages by 12-14% for India-based employees this fiscal.
Wipro today posted muted fourth quarterly numbers. While its consolidated net profit grew 13.77% to Rs 1,375.4 crore in Q4 FY'11, net income from sales increased 18.33% to Rs 8,302.4 crore.
For the fiscal ended March, 2011, Wipro registered 15.34% growth in net profit at Rs 5,297.7 crore, while net income from sales in 2010-11 fiscal grew 14.51% to Rs 31,098.7 crore.