TCS variable pay: In good news for a majority of its employees, Tata Consultancy Services (TCS), India’s largest IT services firm, will give 100% variable pay out to around 70% of its staff for the April to June quarter. The compensation for remaining staff members will be decided by their business units’ performance metrics.Although quarterly variable payments have been consistently distributed, the organisation is yet to finalise its annual salary hike policy. This delay comes amidst challenging economic conditions, resulting in the company experiencing revenue decline in dollar terms for three consecutive quarters.

TCS Variable Pay

TCS has verified the disbursement of variable compensation. A company representative told ET that the eligibility requirements remain “in line with our standard practice across quarters”.In an email communication to staff last week, chief human resources officer Milind Lakkad reportedly said, “All employees up to C2 grade (or equivalent grades) covered under the QVA plan will receive 100% of the Quarterly Variable Allowance (QVA). The individual pay-out for the C3 grade and above may vary, depending on business performance.” At TCS, the hierarchical structure begins with Y grade for trainees, progressing to C1 for systems engineers, followed by C2, C3 – A&B, C4, C5, and culminates with CXOs. Staff members holding C3 positions and above are generally considered senior personnel.The leading IT services provider increased its workforce by 5,060 people during the quarter ending June, bringing its total employee strength to approximately 613,000.The TCS chief executive K Krithivasan spoke of ongoing challenges in Q1 in last week’s earnings announcement, highlighting the persistent and heightened delays in decision-making and project initiations. He noted that global business operations faced disruptions stemming from conflicts, economic instability and supply chain complications.For software service providers, the ability to drive growth significantly depends on discretionary technology investments from their clients.Krithivasan expressed that whilst discretionary expenditure remains low across various sectors, he anticipates a recovery once the broader economic landscape becomes more definitive.