While dismissing exaggerated layoff rumors, TCS rewards junior employees with full quarterly variable payouts and announces salary hikes for high performers amid Q2 profit growth.
100% Variable Pay Announced for Junior Employees
In a much-needed morale boost, Tata Consultancy Services (TCS) has announced that junior-level employees will receive 100% of their quarterly variable allowance (QVA) for the second quarter of FY26.
- This announcement comes as the company reported a net profit of ₹12,075 crore, a 1.4% YoY growth, and revenue of ₹65,799 crore, up 2.4% from the previous year.
- The QVA payout applies to employees in grades C, C1, and C2, which typically include entry to early-mid career levels.
“Thank you for your contribution. All employees up to C2 grade covered under the QVA plan will receive 100% payout,”
wrote Chief HR Officer Sudeep Kunnumal in an internal email.
Higher Payouts for Senior Employees, Performance-Based
While junior employees will receive the full payout, those in grades C3A and above will see performance-based variations.
- The average payout for senior and mid-level staff will be higher than last year, but individual amounts will vary by business unit performance.
- TCS has also rolled out annual salary hikes for employees up to C3A grade, with high performers receiving double-digit increments.
This reflects the company’s performance-linked rewards strategy, encouraging productivity and high impact at all levels.
Clarification on Layoffs: Only 1% Workforce Impacted
Addressing swirling reports of massive layoffs (50,000–80,000 employees), TCS categorically dismissed them as “highly exaggerated.”
- The company confirmed that it had restructured just 1% of its workforce, impacting around 6,000 employees, mainly from mid and senior management.
- The decision was driven by the need to realign skills and roles with evolving business priorities.
“Ignore such inflated claims,” Kunnumal urged employees.
“This move is part of a strategic shift, not a cost-cutting spree.”
Why This Matters for TCS Employees
The announcement of full QVA payouts and salary hikes, especially during a period marked by industry-wide uncertainty and tech layoffs, signals TCS’s commitment to reward loyalty and performance, particularly at the junior level.
- Junior employees are generally more vulnerable to cost-cutting, making this move reassuring for new and early-career professionals.
- The acknowledgment of high-performing individuals with strong raises reinforces a performance-first culture.
Financial Snapshot: TCS Q2 FY26 Performance
- Net Profit: ₹12,075 crore (↑ 1.4% YoY)
- Revenue: ₹65,799 crore (↑ 2.4% YoY)
- Workforce Size: ~600,000 employees
- Layoffs: Approx. 6,000 employees (~1%)
These numbers reflect steady growth amid global volatility and suggest strong fundamentals within the Tata Group’s flagship IT firm.
