Mumbai, July 29, 2025 — Tata Consultancy Services (TCS), India’s largest IT services firm, has announced a freeze on annual salary hikes and lateral hiring across its global operations, following its decision to lay off approximately 12,000 employees—roughly 2% of its workforce. The move is part of a broader cost-optimization strategy aimed at navigating macroeconomic uncertainties and evolving technological demands.
The layoffs, primarily affecting mid- and senior-level staff not currently deployed on active projects, are being implemented under a new internal policy that gives benched employees 35 days to secure billable assignments or face exit. This policy is already in effect across major delivery centers including Hyderabad, Pune, Chennai, and Kolkata.
TCS cited skill mismatches and the need to become a “future-ready organisation” as the rationale behind the restructuring. However, the timing of the layoffs—coinciding with rising executive compensation—has triggered widespread criticism. CEO K. Krithivasan’s annual remuneration of ₹26.52 crore in FY25, nearly 330 times the median employee salary, has become a focal point of public debate.
Social media reactions have been sharply divided. Critics argue that modest pay cuts at the top could have preserved thousands of jobs, while others defend the CEO’s compensation as reflective of leadership responsibilities. Congress leader Praveen Chakravarty suggested that if the top 100 executives took small pay cuts, 12,000 jobs could be saved without significantly impacting their lifestyles.
TCS maintains that the layoffs are not cost-cutting measures but part of a strategic realignment to meet changing client demands and integrate AI-driven efficiencies. Nonetheless, analysts warn that the move signals deeper structural shifts in the IT sector, with other firms likely to follow suit.
The Ministry of Electronics and Information Technology is reportedly monitoring the situation, and employee unions have raised concerns over the legality and transparency of the layoffs.
