TCS defers employee salary hike for 2025, confirms CHRO

IT services major Tata Consultancy Services (TCS) has decided to defer employee salary hikes for 2025 which were earlier expected to start in April. The company cited the growing macroeconomic uncertainty intensified by the ongoing tariff war between the US and other countries for the decision. The IT major made the announcement during the company post earnings press conference. 

The hikes will be implemented later in the financial year, once there is greater clarity, the leadership team said during the press conference, while maintaining a cautious approach as it faces uncertain market conditions. Milind Lakkad, Chief HR Officer, TCS, said, “We will decide during the year when to make the wage hike.”

ALSO READTCS muted on demand uncertainty: Jefferies lists 3 big worries

Even though the annual salary hike is on hold, the IT major will continue to give quarterly variable pay. For the fourth quarter, 70% of employees will receive their full eligible variable pay. The rest of the staff will be paid based on business performance.

TCS’ attrition rate

TCS’ attrition rate for the last twelve months stood at 13.3 per cent for the quarter under review. The IT major’s headcount has risen by 6,433 in Q4FY25 standing at 607,979. In Q4, the total headcount stood at 601,546. 

During the press conference, Milind Lakkad said, “Attrition has inched up a bit to 13.3 per cent in this quarter. We are ok because our quarterly annualised attrition has come down this quarter by 130 basis points. So, we should be ok.” On hiring, he said that FY26 hiring is expected to be the same as FY25 or better.

TCS, on Thursday, announced its fiscal fourth quarter earnings report with profit at Rs 12,224 crore, down 1.69 per cent YoY. It posted revenue from operations at Rs 64,479 crore, up 5.29 per cent as against Rs 61,237 crore during the same period of previous financial year. 

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