MC Exclusive: Infosys defers pay hikes for employees

Infosys typically rolls out increments from April

India’s second-largest IT services company Infosys has deferred the salary hikes that it typically rolls out from April for its employees below the senior management level, Moneycontrol has learnt. This comes as another indicator of the stress companies are under in the current macroeconomic climate as they see projects that are ramped down or cancelled.

Multiple employees in the know have confirmed that they have not received their pay raises that used to come in the June quarter (Q1). They have also received no intimation on the delay or when they are likely to receive their pay increases.

The company also rolls out hikes for its senior management in July, but so far they too haven’t received any communication on the same. It could not be ascertained at the time of publishing if their hikes too have been deferred.

Infosys previously froze hikes in the pandemic year of 2020 due to cash conservation, and then rolled out hikes in January 2021.

Queries sent to the company went unanswered at the time of publishing, and this story will be updated if the company responds.

Infosys is due to report its numbers for the first quarter of the fiscal on July 20, with the quarter expected to be subdued. For the full year, the IT major has guided for revenue growth of 4-7 percent in FY24, marking the first time since FY18 when the company’s revenue will be in this guided range.

In the fourth quarter of FY23, the company reduced its variable payout on average to 60 percent across the organisation. While the average payout was 60 percent, an employee’s final variable payout will depend on their unit or department’s guidelines, and varies for different pay grades and departments.

An email sent to employees at the time said the fourth quarter was impacted by a volatile market and unseen events. “As we remain vigilant to the changes in the market, we must also see this as an opportunity to rally as a group and remain committed to navigating the changing business landscape,” the email sent to employees at the time read.

"While FY23 was a year of strong performance overall, the quarter that went by was impacted by a volatile market and unforeseen events,” an email sent to employees, as seen by Moneycontrol, said.

In the company’s Annual General Meeting last month, Chief Executive Officer Salil Parekh said the overall demand environment has changed.

“What we've seen over the last four quarters, Q4 and before, attrition has steadily been coming down each quarter on a quarterly basis. We see a lot of the initiatives that we've put in place, and also the overall economic environment, both of them relating to the attrition coming down, our employee engagement scores are continuing to go up and we believe that with that we will have a good control on attrition in the coming quarters,” he added.