What's Happening?
Tata Consultancy Services (TCS) has clarified its stance on workforce management, stating that it does not have a fixed target for layoffs. This announcement was made by Sudeep Kunnumal, TCS's Chief Human
Resources Officer, during the company's September quarter earnings call. Kunnumal emphasized that the company's approach is based on continuous evaluation rather than numerical goals. The clarification comes amid discussions about layoffs and attrition trends in India's IT industry. TCS reported a reduction of 20,000 employees in net headcount during the July-September quarter, attributed to both voluntary and involuntary attrition. This reduction is not part of a planned downsizing but a natural outcome of workforce adjustments. TCS had previously aimed to cut about 2% of its global workforce due to macroeconomic challenges and increased AI adoption. As of September 2025, TCS's total headcount stood at 593,314, with attrition at 13.3%. Technological shifts and automation are impacting workforce dynamics, particularly affecting mid and senior-level employees.
Why It's Important?
The clarification from TCS is significant as it addresses concerns about job security in the IT sector, which is facing challenges due to macroeconomic factors and technological advancements. The IT industry is a major contributor to the economy, and changes in workforce strategies can have broad implications for employment and economic stability. TCS's approach to managing its workforce reflects the industry's need to adapt to technological shifts, such as AI adoption, which is reshaping job roles and skill requirements. The company's commitment to handling workforce changes with care, including offering severance packages and support, sets a precedent for humane workforce management in the sector. This approach may influence other companies in the industry to adopt similar strategies, impacting the overall employment landscape.
What's Next?
TCS plans to continue evaluating its workforce, particularly focusing on mid and senior-level employees who are struggling to find suitable roles. The company will likely face scrutiny over its handling of benched employees, those without billable projects. TCS's strategy includes providing severance packages, counselling, and outplacement assistance to affected employees. As technological shifts continue to impact the industry, TCS and other IT companies may need to further adapt their workforce strategies to align with evolving business needs and technological advancements. The company's approach may serve as a model for other firms navigating similar challenges.
Beyond the Headlines
The broader implications of TCS's workforce strategy highlight the ethical considerations in managing layoffs and attrition. The company's commitment to humane treatment of employees during workforce adjustments reflects a growing trend in corporate responsibility. As automation and AI continue to transform industries, companies are faced with the challenge of balancing technological progress with employee welfare. TCS's approach may influence industry standards, encouraging other companies to prioritize ethical workforce management practices.