TCS to Resume Salary Hikes for 80% of Workforce Starting September 1

India: Tata Consultancy Services (TCS) is set to offer salary hikes for nearly 80% of its workforce, starting September 1, 2025, reversing its earlier decision to stall increments due to macroeconomic headwinds.

In an internal memo, CHRO Milind Lakkad and CHRO-designate K Sudeep announced that the compensation revision will apply to all eligible employees up to grade C3A, which includes a large section of the workforce from trainees to senior staff.

Why This Matters?

Earlier in April, TCS was the first IT major to pause hikes, citing economic uncertainty. With rising concerns over AI-led transformations and efficiency, the company had also announced a 2% workforce reduction in July, letting go of around 12,000 employees who could not be aligned with project demands.

This hike now signals a possible strategic shift to retain and motivate the remaining workforce, while optimizing costs.

Understanding TCS Pay Grades

The company follows a structured hierarchy:

• Y – Trainees
• C1 – Systems Engineers
• C2, C3A, C3B – Mid-level to senior staff
• C4, C5 to CXO – Leadership levels

The hike applies till grade C3A, excluding top management.

Industry Impact

With Cognizant already planning its hike cycle for the second half of FY25, and Infosys expected to follow suit, TCS’ decision may influence industry trends and bring positive sentiment among IT employees.