While IT bellwether Tata Consultancy Services (TCS) missed the estimates as it reported its consolidated net profit at Rs 9,478 crore in the April-June quarter, it seems to have excelled in employee satisfaction. The largest IT services company in India added 14,136 employees in the first quarter of the current financial year, taking its headcount to over 6 lakh.
While announcing its June quarter results, TCS announced that its workforce stood at 606,331 as on June 30, however, its attrition rate also soared to 19.7 per cent in the last 12 months. It is the highest in the last six quarters.
On the attrition rate, CEO Rajesh Gopinathan said attrition in this quarter should be also considered from a seasonality perspective as junior level employees go for studies or other areas, but said that it has not yet started to dip.
The workforce increase seems in line with the company’s announcement of a hiring target of 40,000 for FY23 at the end of FY22. TCS CFO Samir Seksaria said the company is on track to hire 40,000 people this fiscal, and is not its changing hiring target.
The IT major had recruited over 1 lakh freshers in FY22 and added 35,209 employees in the last quarter of the year.
Salary hikes
TCS employees received salary increases of 5-8 per cent, with top performers getting even bigger hikes following their annual compensation review. “Our empowering, performance-driven work culture is helping us attract local talent across all our key markets. Continued hiring momentum resulted in a milestone quarter, with the employee strength crossing the 600,000 mark,” said Milind Lakkad, Chief HR Officer.
It’s not just the increase in headcount that should be noted, but India’s top IT exporter has said that its workforce continues to be very diverse, comprising 153 nationalities and women making up 35.5 per cent of the base.
Shift from WFH to WFO
The company gradually accelerated its return to office program in Q1, with about 20 per cent of the workforce now working from office. CFO Samir Seksaria called it a “challenging quarter from a cost management perspective”. “Our Q1 operating margin of 23.1 per cent reflects the impact of our annual salary increase, the elevated cost of managing the talent churn and gradually normalizing travel expenses,” he said.
Dividend announcement
TCS board has declared an interim dividend of Rs 8 per Equity Share of Re 1 each of the company, which shall be paid on Wednesday, August 3, 2022, to the equity shareholders whose names appear on the Register of Members of the Company or in the records of the Depositories as beneficial owners of the shares as on Saturday, July 16, 2022, which is the Record Date fixed for the purpose.
