No variable pay for TCS trainees for first six months

The country's largest software exporter Tata Consultancy Services (TCS) today announced that trainees joining it this fiscal would not be eligible for variable pay of about Rs 5,000 a month in the first six months.

However, they would be eligible for the same after that period and earn a variable pay linked to their performance - whether they are on internal projects or billable client projects, TCS Vice President and Head (Global Human Resources) Ajoy Mukherjee told reporters.

For 2009-10, TCS has made campus offers of about 24,800 and the company will honour all the commitments, he added.

Asked about the cost saved through the move, Mukherjee declined to divulge the numbers.

Last year, the package offered was about Rs 3.15 lakhs annually and variable component came to about Rs 5,000 a month (or Rs 60,000 a year).

The one-year training period includes six-month classroom training in various streams as well as emerging technologies like Web 2.0. The move will not include the trainees inducted in previous fiscal.

Mukherjee said more than a cost-cutting measure, the move was taken to make trainees understand "the fact that it is indeed variable pay and depends on how well they perform in a project".

He added that whether this decision was a short-term or a long-term decision remains to be seen.

"It has been started this year and whether it is continued would be seen later but from the mindset point of view, we would like to continue it."

The move will, however, not affect TCS' Cincinnati campus, which has about 1,000 employees.

"We do not have variable pay in the US. So, this will not affect them," Mukherjee said adding that TCS plans to hire 250 recruits for its Cincinnati campus this year.

About 1,500 trainees are expected to join the firm in the current quarter and about 18,000-19,000 would join in the current fiscal, he said.

About hiring plans for the next fiscal, Mukherjee said, "The hiring plans for the next fiscal is still being worked out. We would hire as per the company's needs and business environment." TCS' attrition rate remained similar to last quarter's 11-11.5 per cent level.