Cognizant will give its employees up to the Associate Director level a pay hike six months ahead of schedule, making this the third such raise in 18 months. This comes as the company tries to arrest soaring attrition levels, which has been a pain point for the company. Attrition declined from 35 percent to 25 percent in Q4FY22, with involuntary attrition at 6 percent.
In an email to employees, a copy of which Moneycontrol has seen, Chief Executive Officer Ravi Kumar S said that employees will receive their letters this week. “Keep in mind that we advanced this merit increase to be six months earlier in the year, following year-end performance reviews. This means many of you are seeing your third merit increase in 18 months,” it read.
He added that combined with the hikes given to those in director positions and above in January, over 3 lakh people are getting a hike.
“Combined with the merit increases eligible Directors and above received in January, Cognizant is awarding more than 300,000 associates a merit increase this year. Over the past couple of years, we’ve invested significantly more in compensation than we have in recent history because of how valuable you, our associates, are to Cognizant’s success,” Kumar said in his email.
He added that the company will provide continuous training, upskilling, and professional development.
Cognizant confirmed the development to Moneycontrol.
This is part of the company’s one-time two-merit cycle hike, which it communicated to employees last year. The company had previously said that employees would receive hikes in October 2022 and then in April 2023.
On improved attrition, CFO Jan Siegmund told analysts last quarter that the company was in the direction of becoming a more attractive employer, and that the labour market dynamic had shifted as well.
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