Bulk of TCS layoffs may take effect this qtr, affecting over 12K employees

Severance packages range from 3 to 5 months' salary, depending on seniority

Tata Consultancy Services (TCS), India’s largest information-technology (IT) services firm, is set to complete the majority of its planned layoffs during the current July-September quarter, according to people familiar with the matter.

 

On Sunday, the company had announced it would reduce its workforce by 2 per cent — over 12,000 employees — as part of its broader efforts to become a more future-ready organisation.

 

While most of these job cuts will take place within the ongoing quarter, the process of redeploying employees or reviewing those currently on the bench will continue through to the end of this financial year, the sources said. “Those who are on bench and are part of the redeployment initiative will be retrained and reskilled. However, if they do not show any improvement in the next six months, they will be asked to go. This process will go on till the end of the financial year,” said one source with direct knowledge of the process.

 

A human-resource (HR) specialist familiar with the internal plans said that 90 per cent of the current round of layoffs would be executed within this quarter. “The company is making sure that appropriate benefits and other support are provided to all the employees,” the person said.

 

According to sources, those immediately affected fall within the mid to senior level, with many in the 15-20 years’ experience bracket. These employees are typically on annual salary packages ranging from ₹35 lakh to ₹80 lakh, with some lateral hires earning even more. Severance offers are being made based on seniority, with compensation equating to three to five months’ salary.

 

“A significant portion of the employees, who are in the senior level category or those nearing retirement (five years of service left), have been asked to take early retirement,” one source said. “In such cases, the employees will get the full benefit that a TCS employee gets after retirement, such as insurance, and a severance package. Many will also be given a recommendation letter.”

 

The company is also working on outplacement support, tapping into its wider ecosystem, including academic institutions, group companies, and partners, for new roles for the affected employees.

 

In an email addressed to employees, the company acknowledged the difficulty of the move. “We understand that this is a challenging time for our colleagues who are likely to be affected,” the message read. “We thank them for their services and will be making all efforts to provide them with appropriate benefits, outplacement, counselling, and support, as they transition to new opportunities.”