Tata Consultancy Services (TCS), India’s largest technology employer, has announced that it will freeze the hiring of experienced professionals and pause annual salary increases across its global operations. The announcement follows just days after TCS revealed plans to cut 2% of its sprawling 600,000+ workforce amounting to about 12,000 jobs as the company grapples with slowing demand, increased adoption of artificial intelligence, and global economic uncertainties.
The company communicated the policy shifts through an internal email, citing the challenging macroeconomic landscape, political tensions worldwide, and a cautious customer attitude as key drivers behind this move. TCS leadership described these steps as essential for long-term stability and organizational sustainability.
TCS has stopped accepting new experienced or lateral hires, and offer onboarding has been significantly delayed sometimes stretched over 65 days. Team leaders have implemented severe restrictions on all external hiring at mid and senior levels. All annual salary increments are suspended for employees worldwide, marking a rare freeze for a company known for its predictable raises.
Layoffs targeting mid to senior roles will affect around 12,000 staff over FY26 (April 2025–March 2026). TCS has imposed a stringent new “bench” policy: those not assigned to client projects must secure a billable role within 35 days or exit. This directive is being enforced across multiple cities with phased reductions already underway.
These restructuring steps are expected to yield significant annual savings estimated between $300–400million (₹2,400–3,600crore) potentially boosting company margins by 100–150 basis points.
This wave of restructuring marks one of the largest HR overhauls in India’s IT sector in recent years, echoing a broader trend of tech companies seeking efficiency amid digital disruption. The freeze and layoffs have stirred unease among IT professionals and prompted India’s employee welfare groups to seek explanations from the company and government.
While TCS maintains that the outlook is robust with a promising project pipeline analysts believe the measures could be a harbinger for similar moves by rival IT firms.