TCS employees face fresh uncertainty as programme linked to promotions, salary hikes deferred: Report

India’s largest IT services company Tata Consultancy Services (TCS) has deferred parts of its internal upskilling and assessment programme, Wings, reported Moneycontrol, citing an internal communication.

The company reportedly informed employees that “Unit Evaluations (including PP4 validations) and assessments” under the Wings programme were being deferred until further notice.

“As part of this, we are progressively reorienting the initiative in line with our AI-first strategy, evolving deployment needs, and business demand dynamics, and the rapidly changing industry landscape,” the internal mail said, according to the report.

The communication added that the deferment would allow the company to “review and refine key aspects of the initiative” so that programme outcomes are more closely linked to “real-time business requirements and future-ready capabilities”.

The move has sparked concern among employees who viewed the programme as an important pathway for salary hikes, promotions and movement into higher-paying digital roles within TCS, the report said.

Some employees also claimed that certain components of the programme continued to operate in parts of the organisation, suggesting that implementation may vary across business units.

The development comes at a time when employee sentiment has been affected by muted salary hikes, lower variable pay payouts and changes in compensation structures rolled out recently by the company.

Monthly variable pay components for some employees were either sharply reduced or shifted to quarterly or annual payout cycles, while portions of performance-linked payouts were linked to work-from-office compliance and attendance-related metrics.

Appraisal shock

Mint had reported that TCS asked managers to identify about 5% of employees for its lowest performance rating during the latest appraisal cycle.

According to Mint, an April communication from a human resources executive to a business unit head asked managers to “review critically and share the list of associates who can be considered for Band D, thereby meeting the agreed 5% distribution”.

The report added that business unit heads eventually classified roughly 3% of employees, or around 17,500 people, as underperformers.

Employees placed in Band D face lower variable pay, removal from projects and placement on performance improvement plans, with the risk of termination if performance does not improve, according to the report.

TCS ended FY26 with a workforce of 584,519 employees, down from 607,979 a year earlier.

TCS Chief Executive Officer and Managing Director K Krithivasan had earlier said that workforce reductions were not driven by AI-led productivity gains replacing jobs.

“This is not because of AI giving some 20% productivity gains. We are not doing that,” Krithivasan had said earlier. “This is driven by where there is a skill mismatch, or, where we think that we have not been able to deploy someone.”

Q4 Results

For the March quarter of FY26, TCS reported a consolidated net profit of ₹13,718 crore, up 12 per cent from ₹12,224 crore in the year-ago period. Revenue from operations rose 10 per cent year-on-year to ₹70,698 crore.

The company’s annualised revenue from artificial intelligence crossed USD 2.3 billion in the fourth quarter of FY26.

For the full financial year 2025-26, TCS posted a net profit of ₹49,210 crore, compared with ₹48,553 crore in the previous fiscal, while operating margin stood at 25 per cent, the highest in four years.