Accenture Plc. has held back salary hikes for its employees in India and Sri Lanka, citing “a macro environment that was more challenging than anticipated”.
“Our reward philosophy is to provide market-relevant pay based on skills and location that is affordable for Accenture. Keeping our payroll aligned with the market is essential to the health of our business, including competitive pricing for our services,” Ajay Vij, country managing director at Accenture India, said in an internal email to employees.
“Given the context of our performance (in FY23), we will not be providing any stay-at-level (base pay) increases this year, except when legally mandated or committed in a few critical skill areas.”
BQ Prime has seen a copy of the internal email.
An Accenture spokesperson said that the company's rewards philosophy is to provide market relevant pay based on the skills and locations where it operates. "We also consider a variety of factors, including the macroeconomic environment in making our decisions around pay and benefits," the spokesperson told BQ Prime.
The move comes a fortnight after Accenture guided weaker-than-expected revenue growth in the financial year ending August 2024. That, after its fourth quarter earnings missed estimates. Earlier in March, the company laid off 19,000 employees globally.
Revenue of the world's largest IT company rose 4% year-on-year to $16 billion in the three months ended Aug. 31, 2023, according to a statement on Sep. 28. That compares with the $16.07-billion consensus estimate of analysts tracked by Bloomberg. For the full fiscal, dollar revenue rose 4% year-on-year to $64.1 billion, while operational profitability—measured as earnings before interest and taxation—shrank 150 basis points to 13.7%.
Accenture now expects to grow 2-5% in the fiscal ending August 2024, as against 4.6% estimated earlier.
“I'm optimistic for the year ahead and confident in our unique abilities to build on our success from last year,” Vij said in the email to employees. “Our clients need us more than ever. By staying close to them, bringing them innovative ideas, and creating even more value every day, we will continue to deliver for them and for all our stakeholders in FY24 and beyond.”
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