Posted on February 18, 2025, by Niftynews
Tata Consultancy Services (TCS salary hike) has confirmed that it will implement its annual salary increments in March, with payouts starting in April. The TCS salary hike range will be between 4% and 8%. The company also ties these salary hikes to compliance with its return-to-office (RTO) policy, which it introduced in early 2024.
Salary Hike Details and Industry Trends
TCS, one of India’s largest IT services companies, typically implements annual salary hikes that vary based on the performance of business verticals. Employees working in divisions that performed well can expect higher increments, while others may see a lower percentage increase.
Reports from employees suggest that the company communicated the upcoming TCS salary hikes would range from 4% to 8%, and these increments will be part of the quarterly variable pay cycle. For the quarter between October and December 2024, TCS distributed variable pay in February, and it will align the salary hikes accordingly.
TCS Salary Hike Linked to Return-to-Office Policy
The major change this year is that TCS salary hikes and variable pay are tied directly to adherence to the company’s return-to-office policy. The RTO policy, which mandates that employees work from the office for a specified number of days each week, has been a point of contention for some workers. However, the company insists that this policy aims to enhance collaboration and productivity, especially as hybrid work has become a common arrangement post-pandemic.
In addition to the TCS salary hike, employees’ compliance with the RTO policy will also impact their performance evaluations. Those who fail to comply with the in-office requirements could see their salary hikes reduced or performance evaluations negatively impacted.
Performance and Growth at TCS
While salary increases in the broader IT sector have slowed in recent years, TCS remains a key player in the market. The company has been able to maintain strong performance, especially when compared to other tech firms that have seen lower growth. In FY22, TCS offered an average TCS salary hike of 10.5%, which dropped to a range of 7-9% in FY24.
Despite these more modest increases, TCS continues to perform well financially. In the third quarter of FY25, TCS posted a 5.5% year-on-year (YoY) growth in net profit, reaching Rs 12,380 crore. The company’s revenue for the quarter increased by 5.6%, amounting to Rs 63,973 crore, with a 4.5% YoY rise in constant currency terms. These results reflect TCS’s ability to thrive in a competitive and evolving industry.
TCS’s Hiring Plans for FY26
In addition to the TCS salary hike, the company is focused on long-term growth. TCS currently employs over 607,000 people and plans to onboard 40,000 freshers by the end of March 2025. The company has also set an ambitious hiring target for FY26, further solidifying its position in the global IT services market. These new hires will help TCS meet its growing demand and stay competitive in an increasingly tech-driven world.
Comparing TCS Salary Hike with Competitors
TCS is not alone in offering salary hikes to its employees. Infosys, India’s second-largest IT services company, also plans to implement salary increments soon. Infosys is expected to issue increment letters by the end of February, with salary hikes ranging between 5% and 8%, similar to TCS’s salary hike plans.
Both companies have seen a slowdown in salary hikes compared to the double-digit increments during the pandemic period. This trend reflects broader challenges in the IT industry, where demand for services has leveled off post-pandemic, and companies are now focused on maintaining profitability and sustaining employee morale.
Conclusion on TCS Salary Hike and Future Outlook
TCS decision to link salary increments to its return-to-office policy demonstrates the company’s commitment to fostering a collaborative work environment. While employees may have mixed feelings about the RTO policy, the salary hikes still offer financial incentives tied to performance and adherence to company policies.
As TCS continues to grow and adapt to changing market conditions, the TCS salary hike for 2025, tied to both performance and RTO compliance, reflects the company’s strategy to balance employee satisfaction with business goals. With solid financial results, a growing employee base, and ambitious hiring plans, TCS is well-positioned for sustained growth in the coming years.
