Tata Consultancy Services (TCS) has announced a salary hike for employees for the financial year 2025-26. The company on Tuesday announced a salary hike between 4.5% to 7% for most employees.
However, there has been no salary hike for senior employees. It is also worth noting that this is the lowest increase the company has made in the last four years. This decision comes after the biggest layoff ever done by the company in July. The company is moving ahead on AI-based automation and cost cutting strategy.
Will be considered effective from September 1
According to sources, since late Monday evening, the company has started sending letters related to salary hike to the employees. This increase will be considered effective from September 1. The official reply to the email sent by the company is still awaited. Tata Consultancy Services (TCS) has announced the lowest salary hike in the last four years for the financial year 2025-26. This decision comes after the biggest layoff ever done by the company in July, indicating that TCS is now moving rapidly towards AI-based automation and cost cutting strategy.
The company has been in discussion regarding the decisions
For the last two months, the company has been in the news for its HR-related decisions. For the last few months, TCS has been in the news for its Human Resource (HR)-related decisions. First, the salary hike was postponed due to market uncertainty. Then, suddenly, the company announced the layoff of 2% of its employees (about 12,000 people). And now, it has been decided to give a salary hike to 80% of its employees.
Top performers got more than 10% hike
Sources also say that most of the lower to middle level employees have been eligible for salary hikes. At the same time, top performers have been given salary hikes of more than 10%. TCS has recorded an attrition rate of 13.8% in the June 2025 quarter, which is slightly higher than the previous quarter. The company has considered this to be slightly above its “comfort zone” (11–13%).
