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TCS Withholds Senior Staff Bonuses After Missing Quarterly Targets
Tata Consultancy Services, or TCS, is changing some workers’ quarterly bonus payments.
Senior employees in grade C3A and above will not get their usual variable pay for the September quarter.
The company said its results were below the targets it had set for itself.
Junior employees will still get all of the variable pay they are eligible for.
Workers told Reuters that TCS usually pays at least some of these bonuses.
They said this was the first time in at least two years the company explicitly said these senior employees would get none.
TCS’s revenue grew slowly compared with recent September quarters.
At the same time, its AI-related revenue increased nearly 20%.
Tata Consultancy Services will pay no quarterly variable allowance to employees in grade C3A and above for the September quarter.
Chief human resource officer Sudeep Kunnumal said the company fell short of its internal performance targets.
Junior-level employees will receive 100% of their eligible variable pay, according to the memo.
Employees told Reuters that TCS typically pays 50% to 100% of variable pay and that this was the first explicit full withholding in at least two years.
TCS reported 0.5% sequential constant-currency revenue growth, its weakest September-quarter growth in three years, while AI-related revenue rose nearly 20%.
- Who
- Tata Consultancy Services (TCS) employees in grade C3A and above; the decision was communicated by chief human resource officer Sudeep Kunnumal.
- What
- TCS withheld quarterly variable allowance from senior staff for the September quarter, while junior employees will receive 100% of eligible variable pay.
- Where
- Bengaluru, India; TCS is an Indian company.
- When
- The September quarter; the memo was reported on October 10.
- Why
- TCS said its performance for the quarter fell short of internal targets.
Company rationale
Employee context
Withholding senior staff variable pay
Company rationale
TCS said it made the decision after careful consideration because quarterly performance fell short of internal targets.
Employee context
Employees told Reuters that TCS typically awards 50% to 100% of variable pay and said this was the first explicit full withholding for these workers in at least two years.
Key facts
- Company
- Tata Consultancy Services (TCS)
- Affected employees
- Grade C3A and above, typically employees with 7–10 years of experience through senior-level management
- Variable pay for senior staff
- No quarterly variable allowance for the September quarter
- Junior employee pay
- 100% of eligible variable pay
- Sequential revenue growth
- 0.5% in constant currency, described as the weakest September-quarter growth in three years
- AI-related revenue
- Rose nearly 20%
- Typical variable pay
- Employees told Reuters TCS typically awards 50% to 100%
Quotes
Sudeep Kunnumal
TCS chief human resource officer, quoted from the internal memo
“For associates C3A grade and above, there will be no QVA (quarterly variable allowance) this quarter. This decision was taken after careful consideration as our performance for the quarter fell short of internal targets.”
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Sources
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