TCS delayed variable pay to some of the employees in June Quarter not as a measure to cut costs but because there is a delay in evaluation of employees
TCS to pay variables to the employees in August
According to the reports, Tata Consultancy Services, is going to pay the variable costs such as bonuses, dividends to its employees for the June quarter in August cycle. Reportedly, the scheduled time for the payment was July. But, as we notice there has been a delay in the payment. It was also reported recently that, IT major Wipro also went on to halt its variable costs for a category of its employees.
Does this mean the companies from IT sector are in a slump trying to cut their costs? Let’s find out!
The delay in paying the Variable Pay in TCS
As far as TCS is concerned, the variable pay was delayed not due to any major reasons and surely not to cut the costs of the company. It was also reported that, TCS will pay all the compensations as per plan, only the variable pay has been delayed. The main reason for the delay is reported as the delay in the evaluation process of a massive size of work force. The company also claimed that, just a small portion of employees are yet to receive their variables and most of them are settled.
High Attrition rates caused alarm bells in the market
Credits: Vantage Circle
India, currently is undergoing a trend, where in people are leaving their jobs left, right and center, in search for better opportunities. The IT sector is witnessing a high attrition rate and it is striking alarm bells for the market. It is high time that, these companies take charge and get the rate under control before its too late. Some of the companies have went on to increase the salaries of their employees to retain them and bring the attrition rate down.
TCS’s steps to bring the attrition rate down
Given that the firm experienced a high attrition rate of 19.7% in the first quarter of the current fiscal year, TCS intends to provide its employees a 5-8% pay raise. Whether the hiked rates will help bring the attrition rate down or not, only time will tell.
What do you think about the delay in the variable pay? Would you agree if you got your bonuses and dividends later? Share your thoughts in the comment section. If you found the article to be informative, then please share it with your family and friends.
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