Wipro pushes salary hikes to Q3, to pay 80% of variable pay for Q1FY24

Wipro handed out salary hikes to employees in September last year.

Wipro will be pushing its wage hike cycle to the third quarter of the fiscal year, as opposed to paying out the salary hike in September as it did last year. During the company’s press conference, the company’s management maintained that wage hikes will be paid out.

The question of salary hikes comes at a time when companies look to defend margins and save on wage bills, the former particularly a cause for concern in the case of Wipro. The company, while it has said that the margins will remain in a similar range, has said it will remain so even as it plans to hand out pay raises in Q3.

“We did our last salary increase in September of last year, and we plan to do that for this year sometime in quarter three,” Chief Financial Officer Jatin Dalal said in the company’s call with analysts, adding that the impact was not being factored in for Q2.

Wipro’s cross-town rival Infosys has deferred its hike as it has not paid out hikes as per its usual April cycle for junior employees, while HCLTech has said that it will defer hikes to junior and mid-level employees by a quarter and skip the compensation review for the management layer and above this year. During the analyst call, HCLTech’s leadership said that the latter makes up a significant portion of the wage bill.

Wipro’s Chief Human Resources Officer Saurabh Govil said during the company’s press conference that the company is continuing to carry out its quarterly promotion cycles —  that it did so in Q1 and will do so in Q2.

The company will pay out 80 percent of the variable pay for Q1, which applies to junior level employees whose payout is linked to the company’s performance. For those at a manager level and above, the variable payout will be as per the performance of the business unit they are part of.

“Our variable pay will pay out will be around 80% in Q1 in spite of this environment. We will continue to do what is required for our employees but continue to calibrate with the business requirement,” he said.

The business requirement has also been the reason that Wipro is yet to onboard all the freshers it recruited last year. It did not go to campuses in the current fiscal, and said that it did not onboard in Q1. The company did not divulge any hiring targets either, and ended the quarter with 8,812 fewer employees.