TCS Salary Hike: Average 5% Increment, Some Employees Report Pay Cuts; Variable Pay Lowered

Last Updated:May 18, 2026, 17:36 IST

Employees in the B band reportedly get hikes in the range of 1%-3.5%, while many workers in the C band claims their salary revisions were either negligible or negative.

TCS Salary Hike 2026.

IT major Tata Consultancy Services (TCS) has rolled out an average salary hike of around 5% in its latest appraisal cycle, but several employees have alleged that their take-home salaries have actually fallen amid changes in compensation structures and lower variable payouts, according to a report by Moneycontrol.

The report comes at a time when India’s IT services sector continues to face pressure from weak discretionary spending, delayed client decision-making and margin concerns, forcing companies to tightly manage salary revisions and payouts.

Top-Rated Employees Get 9-13% Hike

Moneycontrol reported that employees in the top-rated A+ performance category received hikes ranging between 9% and 13%, while those in the A band largely saw increments of 5%-9%.

Employees in B Band Gets 1-3.5% Hike

Employees in the B band reportedly received hikes in the range of 1%-3.5%, while many workers in the C band claimed their salary revisions were either negligible or negative.

According to the report, average hikes stood at over 7% for A band employees, 10% for A+ employees, 3% for B band workers and just 0.3% for those in the C category.

At TCS, employees are broadly classified into performance categories such as A+, A, B and C during annual appraisals, with top performers generally receiving higher increments and better variable payouts.

The company’s total headcount currently stands at 5,84,519 employees.

Several Employees Report Salary Reduction

Moneycontrol reported that several employees alleged their annual compensation had actually declined despite receiving appraisal letters.

“Our annual CTC had fallen by Rs 1,000-Rs 10,000 despite receiving appraisal letters,” an employee told Moneycontrol on the condition of anonymity. “Salary actually decreased by 3000,” another employee claiming to belong to the C3A grade said, according to the report.

Another employee quoted by Moneycontrol said, “Mine decreased at C band.”

Several workers reportedly claimed that changes in allowances, salary structure and variable pay components resulted in lower revised compensation. A major concern flagged by employees was that gratuity was no longer reflected in displayed CTC calculations. Some workers reportedly said this could hurt salary negotiations while switching jobs because their compensation figures now appear lower on paper.

Variable Pay Cut

Employees also alleged that monthly variable pay components had reduced sharply or were shifted to quarterly or annual payouts.

“Performance pay and bonuses are both now calculated based on WFO compliance,” another employee told Moneycontrol, referring to work-from-office attendance metrics.

Salary Restrucuturing

The report further said some workers flagged higher mediclaim premiums and restructuring of salary components, including movement of personal allowances into house rent allowance (HRA).

The latest concerns come months after TCS implemented annual salary hikes averaging 4.5%-7%, with double-digit hikes for top performers. In its annual report released on May 16, the company said junior and mid-level employees received annual increases in the range of 4.5%-7%, while top performers got double-digit increments in India.

“The average annual increase for junior and mid-level employees was in the range of 4.5 – 7.0 percent, with top performers receiving double-digit increments in India,” TCS said in its annual report, as quoted by Moneycontrol.

The report also suggested that TCS may have introduced a new A+ performance bucket this year, widening the gap in salary hikes between top-rated and lower-rated employees.

TCS had not responded to Moneycontrol‘s queries on compensation restructuring and employee concerns at the time the report was published.

Read More