In a significant policy revision, Tata Consultancy Services (TCS), a leading global IT services, consulting, and business solutions organization, has brought forward a change that marks a departure from the flexible working arrangements which became commonplace during the pandemic. The organization, which boasts a vast employee base, has introduced a new policy that mandates a minimum in-office attendance to qualify for variable pay components.
The updated quarterly variable pay policy makes working from the office a critical determinant for employees’ bonus eligibility. According to this latest mandate, only those staff members with a minimum of 60 percent office attendance over a quarter would be entitled to receive their variable pay. This move underscores the company’s drive towards normalizing pre-pandemic working conditions, reflecting a broader trend in the industry towards re-establishing traditional work models.
The details of the policy indicate a tiered approach to the calculation of the variable pay. Employees who achieve 60 to 75 percent attendance can expect to receive half of the potential variable pay. As attendance increases, so does the proportion of the payout, with those registering 75 to 85 percent attendance entitled to 75 percent of the variable earnings. Attaining above 85 percent attendance is required to secure the full variable pay amount allotted for the quarter. These figures were disclosed in a report by The Times of India, which highlighted the company’s firm stance on in-office attendance as a performance metric.
It is worth noting that not all companies within the Indian IT sector have taken a similar route. Industry contemporaries such as Infosys and Wipro have elected not to tie variable payouts to the return to office mandates. In contrast, Wipro, through its Chief Human Resources Officer, Saurabh Govil, informed that the firm had handed out an average variable pay of 85 percent in the March quarter of the fiscal year 2024, which aligns with the consistency shown in the compensation of junior employees in the previous December quarter.
TCS’s policy turnaround stems from an internal communication that surfaced in February, revealing plans to link variable compensation directly to employees’ physical presence in office spaces. The decision effectively concluded the hybrid work mode that TCS had adopted during the pandemic, a flexible arrangement that allowed employees to alternate between remote work and in-office duties.
This development emerged after TCS had already instructed its workforce to return to on-site work five days a week by October 1, 2023, signaling a definitive step towards the restoration of conventional work practices. The mandate aligns with the company’s prioritization of collaborative in-person interactions and the reinforcement of corporate culture and community.
In the context of the broader market, the policy shift is particularly salient. At a time when the IT industry is grappling with the challenges of evolving work culture, economic pressures, and fierce competition for talent, TCS’s decision highlights a stance that may influence the sector’s direction on work models going forward. Other Indian IT companies will undoubtedly observe the outcomes of this policy change closely, assessing its impact on employee satisfaction, productivity, and retention.
Additional industry news includes Zomato’s announcement of a 25 percent hike in its mandatory platform fee, now set at Rs 5. Moreover, government-owned oil companies have launched an initiative conducting free safety checks for all LPG connections, emphasizing the industry’s focus on customer safety and satisfaction even amidst internal policy shifts and market reevaluations.
As TCS forges ahead with its new office attendance policy, the ripple effects across the industry and employee landscapes remain to be fully determined. Employees, stakeholders, and analysts alike will be watching closely to gauge the success of TCS’s updated variable pay strategy and its broader implications for the future of work in the IT sector.
