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India's largest IT firm, Tata Consultancy Services (TCS), has decided to reward its top-performing employees with a 12 to 15 per cent salary, Mint has reported. The hike is likely to help retain talent.
The company hopes that at a time when the job market has slowed down and companies have conducted large-scale layoffs, this salary hike will bring down attrition from 20 per cent at present to 13 to 14 per cent in the second half of the financial year.
In addition to this, the company is also planning to raise its base salaries in its campus recruitment drives. If implemented, this is likely to make Infosys, HCL Technologies, and Wipro follow suit.
The report quoted the Chief Human Resources Officer at TCS, Milind Lakkad, "For high performers, we are looking into [pay hikes in] the 12-15 per cent range. Everybody else, basically, we have 8 per cent, 5 per cent, and 1.5 per cent for those who are not performing."
At a time when IT spending across the globe has witnessed a downfall, TCS hired 44,000 employees from campuses last financial year. TCS is planning to add another 40,000 employees to its workforce during the current fiscal year, the report added.
TCS registered attrition rates of 21.3 per cent in the December quarter as IT services companies went over the top to hire employees. However, over the last two to three quarters, the global financial situation and geopolitical tensions fuelled by the Russia-Ukraine war have led to layoffs and hiring freezes across many firms.
In addition to resignations, there has also been a decline in counteroffers and negotiations. Lakkad added, "The instant gratification that happened in the last two years has come down significantly, if not stopped. It is the right thing for everybody—more for the people than the organisation. Organizations will manage if we have managed what happened in the last two years reasonably well."
