Tata Consultancy Services is set to increase salaries of approximately 80% of its employees starting Sept 1, 2025. This comes amidst a restructuring effort that will also see company lay off around 12,000 employees, primarily in mid and senior roles.
In a broad attempt to reorganise its workforce and future-proof its operations, Tata Consultancy Services (TCS) expects to let off some 12,000 people this year, but it will also start paying 80% of its workers more starting on September 1. Chief Human Resources Officer Milind Lakkad and CHRO Designate K Sudeep announced the pay increase in an internal email on Wednesday, according to a PTI report. The email thanked staff members for their “hard work and dedication” and said, “We are pleased to announce a compensation revision for all eligible associates in grades up to C3A and equivalent.”
While the size of the increases is unknown, a corporate spokeswoman acknowledged the change, saying: “We will be raising wages for approximately 80% of our employees beginning September 1, 2025.”
The wage increases will cover junior and mid-level employees, which the company defines as up to grade C3A and equivalent.
The news comes amid a larger shake-up. TCS plans to lay off around 2% of its worldwide workforce, or over 12,000 individuals, largely in mid and senior jobs. The changes are part of the company’s transition to becoming a “future-ready organisation,” which includes significant expenditures in AI, market development, and new infrastructure.
“As part of this journey, we will also be releasing associates from the organisation whose deployment may not be feasible,” the business stated a few weeks ago.
This two-pronged strategy—raising younger employees’ salaries while reducing senior staff—illustrates the changing priorities in India’s IT industry, which is battling with challenges from the US trade policy, the global economy, and the rapid advancements in artificial intelligence.
Top software companies in India, such as TCS, Infosys, and HCLTech, reported modest single-digit revenue growth in Q1 FY26, which is indicative of delayed transaction decisions in international markets and client anxiety.
Industry-wide anxiety has been aroused by TCS’s layoffs, prompting enquiries about whether the IT sector is ready to undergo a structural overhaul following decades of steady expansion.