The retrenchment in TCS will have a greater impact on middle and senior level employees. However, some impact will also be felt on those entry-level employees who have been on the bench for a long time. TCS is India’s largest IT company. More than 6 lakh people work in TCS.
TCS has planned to lay off about 12,000 employees. This is 2 percent of the total number of employees of the company worldwide. The special thing is that the reason for this is not artificial intelligence. The reason for the retrenchment is that the company has limited opportunities to use the employees. The company is facing a skill gap among the employees. TCS CEO and MD K Krithivasan gave this information to Moneycontrol. TCS is India’s largest IT company. More than 6 lakh people work in TCS.
Productivity increased by 20% due to AI
TCS CEO and MD K Krithivasan told Moneycontrol in an exclusive interview, “The reason for layoffs is not that productivity gains have increased by 20% due to AI. We are not doing that. The reason for layoffs is skill mismatch or we are laying off employees where we have not been successful in putting employees in the project.” He said that it is not so, we need fewer people. Our search for high quality talent will continue. We will continue hiring and training talent.
Layoffs will have more impact on middle and senior employees
Layoffs in TCS will have more impact on middle and senior level employees. However, some impact will also be felt on those entry-level employees who have been on the bench for a long time. Moneycontrol had reported about this and told that the company has changed its bench policy, due to which many entry-level employees may lose their jobs. TCS’ plan for this big layoff is being seen as a sign of pressure on the IT industry.
The company has trained lakhs of employees
Krittivasan said, “We have trained a lot of people. We have trained 5,50,000 people in basic skills and 1,00,000 people in advanced skills. It is a big issue whether we have been successful in putting the employees on the project after the training or not. In such a situation, we can train some employees but we cannot train them for skills at level 1 and above. The reason for this is that when an employee is at a senior level, he cannot use entry level skills.”
TCS will pay salary to the retrenched employees during the notice period. Apart from this, severance package will also be given. When a company removes its employees, it gives a compensation, which is called Severance Package. The company will also try to provide insurance benefits and offer outplacement opportunities. The layoff process will be completed in the remaining three quarters of FY26.
TCS stock fell 29 per cent in the last one year
TCS shares came under pressure on 28 July. In the morning, the stock was down 1.31 per cent at Rs 3,094. TCS shares have not performed well in the last one year. This stock has crashed more than 29 per cent in the last one year. TCS is a Tata Group company. In terms of market capitalization, it is the largest company of the Tata Group.
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