TCS gives 100% variable pay to 70% employees; HR head says: Payment to the rest of the employees will be based on ...

Tata Consultancy Services (TCS) has announced 100% variable pay for around 70% of its employees for the quarter ending June. According to an Economic Times report, payment to the rest of employees will be based on the performance of their respective business units. The IT firm sent an email to its employees last week, informing them about the variable payout, which the publications claims to have seen a copy of. “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”, TCS chief human resources officer Milind Lakkad wrote in the email.

Grade structure at TCS

TCS has an employee grading structure that starts with entry level marked as Y trainees. It is followed by systems engineers at C1, followed by C2, C3 – A&B, C4, C5 and CXOs. As announced by the company, all employees up to C2 grade will receive 100% of their variable allowance.

Employees in the C3 and above band – likely the senior category – will receive variable payment basis performance of their business units.

A TCS spokesperson confirmed the payout to ET, saying it is “in line with our standard practice across quarters”.

Decision on annual wage hikes still pending

The ET report states that despite the rollout of variable compensation for each quarter, the company is yet to make a decision on annual wage hikes amid a weak macro environment.

Referring to Q1 performance, TCS CEO K Krithivasan said last week “We have spoken about delays in decision-making and project starts. With respect to discretionary investments, this trend has continued and intensified to some extent in this quarter and global businesses were disrupted due to conflicts, economic uncertainty and supply chain issues”.




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