TCS hikes variable pay for seniors, keeps 100% bonus for juniors

Tata Consultancy Services (TCS) will raise variable pay for senior employees while continuing to provide 100% quarterly bonuses for junior staff, Chief Human Resources Officer Sudeep Kunnumal said after the company announced its second-quarter results, Press Trust of India reported.

Kunnumal confirmed that employees in grades C, C1 and C2 will continue to receive their full Quarterly Variable Allowance (QVA) along with annual salary increments. He said the revised policy aims to reward senior executives based on both individual and unit performance, with overall payouts higher than last year.

“Basically, it covers all the people who have been with our organisation, who are entitled for the quarterly bonus, except maybe for new joinees,” Kunnumal told PTI. “At the junior level we have been paying 100 per cent, which will continue. For seniors, we will pay a higher amount, again based on individual and unit performance.”

In an internal email cited by the Economic Times, Kunnumal reiterated that all employees up to C2 grade would receive 100% of their QVA, while those at C3A grade and above would see variable payouts tied to performance metrics. “The overall QVA payout for this segment will be higher than the previous year,” he wrote.

The changes come as TCS, India’s largest IT services company, faces scrutiny over restructuring and workforce realignment. Responding to reports of large-scale layoffs, Kunnumal clarified that while the company is reorganising roles as part of its artificial intelligence push, job cuts would be closer to 12,000, or around 2% of its global workforce, not the 50,000 to 80,000 figures suggested in some media coverage.

The revised pay structure signals TCS’s intent to balance stability for its junior workforce with stronger performance-linked incentives for senior staff at a time of industry-wide transformation. Analysts note that variable pay decisions at TCS often set the tone for broader compensation trends in the Indian IT sector.