TCS Hike Brings Mixed News for Employees
TCS hike announcements have brought both relief and uncertainty for employees. From September 1, 2025, Tata Consultancy Services will roll out salary increases ranging between 2% and 8% for nearly 80% of its workforce. The decision comes at a time when the company is also preparing to release around 12,000 employees over the course of the year as part of its strategy to become a “future-ready organisation.”
The wage revision will apply to both onshore and offshore staff, with junior to mid-senior level employees in the C1, C2, and C3 categories those earning between ₹15 lakh and ₹35 lakh annually eligible for the hike. While offshore workers will see the larger jump of 6% to 8%, onshore staff are expected to get between 2% and 4%. High performers may even receive double-digit increments under the company’s performance-driven approach.
Performance-Based Growth Under the Bell Curve Model
TCS follows a bell curve performance model, grouping employees into high, average, and low performer categories. The upcoming hike will reward strong performers more generously, in line with this structure. For the majority of eligible staff, the increase is expected to provide some respite in a year marked by global IT market uncertainty, automation advances, and intense cost-optimisation efforts by clients.
An internal communication confirmed that employees up to grade C3A and its equivalent would receive the revised pay, covering around 4.5 lakh people. This wage adjustment is aimed at recognising contributions while ensuring competitiveness in the industry.
Restructuring for a Future-Ready Workforce
While the TCS hike is welcome news for many, it comes alongside significant restructuring. The company plans to release about 2% of its global workforce, largely in middle and senior roles, citing deployment challenges and a shift towards newer technologies. The move is part of a broader transformation that includes reskilling programs, redeployment efforts, and deeper integration of Artificial Intelligence into operations and client services.
TCS leadership has highlighted its focus on strengthening partnerships, entering new markets, and creating next-generation infrastructure. These steps, it says, are necessary to stay ahead in a rapidly changing technology landscape.
Employee Sentiment and Industry Context
The announcement follows an uptick in attrition rates, which climbed to 13.8% in the June 2025 quarter the highest in nearly two years. In the same period, TCS added a net 6,071 employees, bringing total headcount to 6,13,069.
Industry analysts note that while salary hikes are a positive signal, the simultaneous layoffs underscore the broader challenges facing the IT services sector. Rising US trade barriers, evolving outsourcing models, and the disruptive influence of AI are pushing companies to recalibrate both workforce size and skills.
For employees, the mixed announcement reflects a shift towards a leaner, more specialised workforce, with future growth increasingly tied to performance metrics and adaptability to emerging technologies.
What Lies Ahead for TCS and Its Employees
With the TCS hike effective in September, employees who meet performance benchmarks stand to benefit financially, even amid a cautious business climate. However, those in non-strategic roles may face redeployment or exit as the company streamlines operations.
The IT major’s transformation journey suggests that future rewards will go hand-in-hand with reskilling and the ability to work in high-growth technology areas. For now, the message from leadership is clear TCS is investing in talent that aligns with its vision for a future-ready, AI-enabled enterprise. Also Read: iPhone 17 to Launch in September With Bigger Storage and a Price Twist
The TCS hike announcement brings a blend of optimism and caution for its vast workforce. While most eligible employees will see higher pay from September, the ongoing restructuring means adaptability will be crucial for long-term growth within the company.
