Tata Consultancy Services (TCS) on Tuesday said that it would be paying 100 percent variable pay for its 600,000-plus employees for the first quarter, according to media reports.
“We have come across completely incorrect reports on our compensation. Variable pay is either paid in month one or two as per the normal process, and there is no delay…100 percent variable pay is being paid for Q1,” TCS said in a statement, Moneycontrol reported.
The clarification came days after reports surfaced that India’s largest IT firm had delayed the June variable compensation payout by a month for some employees.
On August 20, Economic Times reported that the Tata Group company had delayed the variable payout for C3A, C3B, C4, and equivalent grades by a month. These are assistant consultants, associate consultants, and consultant levels employees. According to an internal email accessed by ET, the money due to be paid in July will be paid by August-end.
So far, more than 90 percent of TCS employees have received the variable payout, according to the largest software exporter in India.
Another IT major, Infosys, has decided to reduce the average variable payout of employees to 70 percent due to falling operating margins in the first quarter (Q1) of 2022-23 (FY23), said people in the know on Tuesday.
High attrition rates, leading to increased employee costs, have impacted the operating margins of Indian IT companies during the last quarter.
Variable pay is the incentive companies pay to employees based on performance. Companies may choose a variety of ways to give variable pay, and not all forms are monetary.
