Tata Consultancy Services (TCS) is on track to pay 100 percent variable pay to 70 percent of its employee base, which will include junior to mid-level staff for the third quarter ended December 31. The remaining staff will be getting their payout based on business-related performance, said CHRO Milind Lakkad.
“As we always give, 100 percent variable pay will be given out to 70 percent of employees and the remaining 30 percent will be paid based on the business-related performance,” he said during the company’s Q3 earnings conference.
TCS had also rolled out variable pay fully in both Q1 and Q2. Meanwhile, peers Wipro and Infosys had given out only 80 percent of variable pay in Q2.
TCS saw its headcount decline by 5,680 QoQ, for the second consecutive quarter. The attrition rate too continues to drop and improve.
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On a QoQ basis, attrition came down to 13.3 percent from 14.9 percent last quarter. Lakkad has maintained that given the investment in getting fresh talent they have made for nearly 18 months has now started to pay off.
“13.3 percent range for attrition is very satisfying to see. This has come down to our comfort range. Now whether it will come down from there…I expect it to come down further,” Lakkad said addressing the media at the conference.
On employee headcount going down, he added, “I would say a significant investment went in the past few years (in hiring talent), and we are continuing to leverage that investment today and that’s driving it today.”
TCS reported its Q3FY24 earnings on January 11. Net profit grew 2 percent YoY coming at Rs 11,058 crore. Consolidated revenue was up by 4 percent YoY, reaching Rs 60,583 crore.
Ebit margin too improved by 50 bps to 25 percent, beating Moneycontrol’s estimates.
Also read: Infosys to skip campus hiring again, TCS to resume from FY25
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