70% of TCS employees to get full variable pay in Q2

“We are going to pay 100% variable pay for 70% of employees… the remaining 30% will get paid based on their business unit performance. This is for Q2 (July-September),” said Milind Lakkad, chief human resource officer at TCS during the analyst conference call after announcing the company’s financials for the quarter ended September 30 on Monday.

The IT giant said a third of its workforce of 6,16,171 people have returned to office twice a week while terming “moonlighting” as an ethical issue that is not in line with TCS’s culture.

“Moonlighting, we believe, is an ethical issue and against the culture and core values in general,” said Lakkad reiterating the company’s stand on the issue. TCS, however, has not taken any action with regard to the emerging practice among the techies. Rajesh Gopinathan, CEO of TCS also added that it is codified in its employment contract, that “you are not allowed to work anywhere else while being employed with us.”

The company also said that it has brought onboard 20,000 freshers this quarter, and “honoured” all the offers made amid a larger industry trend of delaying fresher joining due to a weak demand environment.

“Reflecting our culture of being committed to our employees, we have honored all the job offers we had made…” Lakkad said.

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The attrition for the company increased to 21.5% compared to 19.7% last quarter. But TCS indicated that attrition has peaked and will be on a “downward” trend from here on.

“We believe our quarterly annualized attrition peaked in Q2 and should see it taper down from this point, while compensation expectations of experienced professionals moderate,” said Lakkad.

TCS made a net addition of 9,840 people this quarter and onboarded close to 20,000 freshers. It had said it plans to onboard 45,000-47,000 freshers in the current fiscal year out of which it has already hired 35,000 so far.

Last fiscal, the company had reported around 26,000 net employee additions per quarter, however, the management noted that lower hiring is a sign of its mature talent supply model.

“We have invested the last 6-9 months in organic talent development with some market addition of laterals. You have to see net additions in that context,” said Milind Lakkad, global head HR, TCS.