After Rs 2.5 LPA job offer, Cognizant grants 1% salary hikes to employees

The annual raises ranged from 1 per cent to 5 per cent at the highest, after the increments were implemented with a four-month delay

Cognizant Technology Solutions has reportedly given some employees annual salary increases as low as 1 per cent, amid controversy surrounding the company’s decadal-low pay packages for new hires. The company implemented these increments after a four-month delay, according to a report by The Economic Times, which cited sources familiar with the matter. The raises range from 1 per cent to 5 per cent at the highest, the report noted.

A source, who spoke to the business-daily anonymously, stated, “For employees with a performance rating of three, the raise is about 1-3 per cent, while those with a rating of four received a 4 per cent hike, and a top rating of five earned an increment of around 4.5 per cent, with the maximum being 5 per cent.”

 

In 2023, Cognizant raised its employee salaries in April, ranging between 7 per cent and 11 per cent. This news comes at a time when the company is facing criticism for offering starting salaries as low as Rs 2.52 lakh per annum to freshers recruited through its off-campus hiring drive, a pay scale that has sparked widespread debate on social media.

Cognizant, which employs approximately 254,000 people in India, accounting for about 70 per cent of its global workforce, recently reported a reduction in total headcount by 8,100, bringing the global workforce to 336,300 as of the quarter ending in June.

In its financial results for the second quarter ending in June, Cognizant posted a 22.2 per cent year-on-year increase in net profit, amounting to $566 million, alongside a 3.6 per cent sequential growth.

Controversy surrounds Cognizant’s Rs 2.5 LPA job offer

Cognizant’s recent off-campus hiring program has drawn significant criticism on social media, due to its entry-level salary offer of Rs 2.5 lakh per annum (LPA) for fresh graduates. Despite its status as a leading global IT firm, Cognizant has maintained this salary level since 2002, causing widespread dissatisfaction, particularly in light of current economic challenges.

Amid the uproar over the low starting salary, attention has shifted to Cognizant’s CEO, who holds the distinction of being the highest-paid IT CEO in India. According to a LiveMint report, CEO Ravi Kumar Singisetti earned a remarkable $22.56 million (approximately Rs 186 crore) in the past year.

Singisetti, who took over as the chief executive in January 2023, received a one-time stock award valued at $20.25 million (around Rs 169.1 crore), making him the highest-paid IT CEO in India for 2023. His compensation package is reportedly 556 times the median salary of Cognizant employees.

WATCH: Rs 2.52 LPA for freshers, how Cognizant hikes salaries for existing employees