TCS to Announce Salary Hikes for FY25, Employees to Receive Letters in March

Tata Consultancy Services (TCS), India’s largest IT company, is set to announce salary hikes for the financial year 2025. Employees will receive their increment letters in March, and the new salaries will take effect from April. Reports suggest that salary hikes will range between 4% and 8% this year.

How This Compares to Previous Years

In FY22, TCS gave an average 10.5% hike, but this dropped to 7-9% in FY24. The company, which currently has 607,354 employees, also plans to hire 40,000 fresh graduates by March, with even more hiring expected in FY26.

Salary Hikes Linked to Office Attendance

TCS has tied salary hikes and variable pay to its return-to-office policy, which started in early 2024. Usually, employees in high-performing teams get better hikes, but overall, the raises have been modest.

Recently, TCS released variable pay for the October-December quarter in February. Senior employees reportedly got lower payouts, between 20% and 40%.

IT Sector Trends

The IT industry, worth $254 billion, has moved from double-digit salary hikes during the COVID-19 boom to single-digit hikes in recent years. Infosys, India’s second-largest IT firm, has also announced salary hikes between 5% and 8%, with employees receiving their salary revision letters by March-end.

TCS Salary Structure and Employee Concerns

TCS follows a structured grade system, starting from Y (trainees) and moving up through C1 (systems engineers), C2, C3 – A&B, C4, C5, and senior leadership (CXOs). This year, employees in C3 and lower grades (about 70% of the workforce) received full variable pay.

However, some long-term employees feel that salary hikes have been low for the past 3-5 years, even though the IT sector is showing signs of recovery.