...defers salary hikes amid global uncertainty

India's largest information technology (IT) services firm by revenue, Tata Consultancy Services (TCS), said it was deferring salary hikes for employees starting April, citing the growing macroeconomic uncertainty intensified by the ongoing tariff war between the US and other countries.

- AVIK DAS

The hikes will be implemented later in the financial year, once there is greater clarity and the outlook improves, company executives said at a press conference on Thursday.

"We will decide during the year when to make the wage hike," said Milind Lakkad, chief human resources officer of TCS.

The move echoes a similar decision made during the onset of the pandemic five years ago, when global business had ground to a halt. It also reflects the caution sweeping the IT services sector as companies tighten budgets. Rivals such as Infosys and Wipro, which report their fourth-quarter (Q4) results next week, may take similar steps.

While salary hikes are on hold, TCS will continue with quarterly variable payouts. For Q4, 70 per cent of employees will receive 100 per cent of their variable pay, while for the rest, it will depend on business performance.

The consumer and automotive verticals are expected to be most affected by the tariffs. However, the BFSI (banking, financial services, and insurance) segment showed positive Krithivasan, however, said the company managed to grow sequentially, despite these concerns momentum.