TCS Layoffs: 'We Will Continue To Evaluate People,' Says HR Head
The company’s chief HR officer, Sudeep Kunnumal, clarified the involuntary attrition was currently at the 1% mark, midway through its estimated 2% workforce reduction announced earlier this year
Tata Consultancy Services (TCS) has confirmed it has "released" approximately 1% of its workforce, or about 6,000 employees, as part of an ongoing restructuring effort.
The company’s chief HR officer, Sudeep Kunnumal, addressed investor and media concerns, stating the firm is not pursuing a targeted layoff number, but will continue to evaluate employee performance in line with its strategic pivot toward becoming an "AI-led technology services company."
Speaking during the recent Q2 earnings call, Kunnumal dismissed widespread rumours suggesting potential job cuts could reach 50,000 to 80,000 as "extremely exaggerated." He clarified the involuntary attrition is currently at the 1% mark, putting the company midway through its estimated total workforce reduction of 2% announced earlier this year.
"We are not chasing a target. We'll continue to evaluate everyone after all the investment in learning and development that we have done," Kunnumal stated. He confirmed the current exits primarily affect mid- and senior-level employees whose skills could not be redeployed in the right roles within the organisation.
To a question whether there will be no involuntary attrition beyond the 1% number, Kunnumal replied they estimate the attrition to be 2%. "We are currently at 1%, and we will continue to evaluate people whom we can redeploy – whom we are not redeploying, and those are the people that we will release," said Kunnumal.
The company, which created shockwaves in July by announcing plans to lay off 12,000 employees, reported a 20,000 drop in the overall headcount at the end of the quarter and disclosed that it took a Rs 1,135-crore hit due to severance packages offered to mid-to-senior level employees who were asked to go.
Kunnumal also mentioned TCS has significantly localised its workforce in the US and is confident its business model can adapt quickly to changes in immigration policies, such as the proposed H-1B visa rule updates. As the technology sector navigates a shift toward AI and automation, TCS also declared its vision to be the 'world's largest artificial intelligence technology services' player in the next few years and announced a slew of initiatives centered around that through interventions in training the workforce.
From a profitability perspective, TCS reported a widening of the margin to 25.2%, which was 0.70% up from the preceding quarter. The margin figure excludes the severance pay. Its chief financial officer Samir Sekhsaria said it prioritised wage hikes during the quarter by giving an increase to 80% of its workforce.
