TCS to give full variable pay to 70 per cent employees in Q2FY23: Report

In Q2FY23, TCS saw an eight per cent year-on-year (YoY) jump in its net profit to Rs 10,465 crore, beating the estimates

Tata Consultancy Services (TCS) will pay a 100 per cent variable pay to 70 per cent of its employees in the second quarter of the current financial year (Q2FY23). The IT major's Chief Human Resources Officer Milind Lakkad made the announcement after the declaration of the company quarterly results, according to a report by Moneycontrol (MC). 

"The remaining 30 per cent of employees will be paid [the variable pay] based on the business unit performance," Lakkad said, as reported by MC.

In Q2FY23, TCS saw an 8 per cent year-on-year (YoY) jump in its net profit at Rs 10,465 crore, beating estimates. The revenue rose 18 per cent YoY to Rs 55,309 crore. 

In Q1FY23, the company paid variable pay to all its employees. According to a statement released by the company, the pay was transferred in the first or the second month of the quarter. 

Also read: TCS to hire additional 10k-12k freshers in current year amid 21% attrition

Wipro and Infosys, according to MC, had slashed the variable pay in the first quarter. Wipro did not pay the amount to mid and senior-level officials. Nearly 70 per cent of the variable pay was given to junior-level employees. 

Infosys, on the other hand, gave 70 per cent of the pay to all its employees. 

Amid high attrition, TCS hired 35,000 freshers in the first half of FY23. It further expects to hire 10-12,000 more freshers in FY23. However, the decision on hiring will be taken after Q3FY23. 

In Q2FY23, the attrition rate of TCS rose to 21.5 per cent from 19.7 per cent in Q1FY23. However, the company said that the attrition has peaked and will taper down in the coming quarters.