New Delhi: After reports that managers were directed to put about 5% employees in the lowest rating Band D, TCS faces renewed concern about the possibility of layoffs and enhanced performance evaluations at its firm. Band D is the lowest rating in TCS’s internal appraisal system. Employees in this category can suffer various consequences, including lesser bonuses, project elimination, restricted career advancement, performance improvement plans, and eventually job termination.
The Indian tech giant TCS currently employs nearly 5.84 lakh people across the world. If 5% of the total workforce is tagged under Band D, the figure will be close to 29,000. According to the report, TCS managers were instructed to thoroughly evaluate the performance of employees and select those failing to meet the standards.
Band D is believed to be the lowest rating of TCS’ internal evaluation process. Workers in this category can suffer consequences ranging from lesser bonuses, project elimination, restricted career progression, performance improvement plans, and finally job termination.
The reports come at a time when India’s IT industry is already under pressure owing to global economic slowdown and rise in artificial intelligence usage. Various technology firms are currently focused on cutting costs and enhancing efficiency by leveraging AI capabilities for coding, testing, customer service, and other technical purposes.
According to industry observers, AI has started altering the traditional working style of IT companies. Previously, bigger teams were required to finish large software projects within a short period. But now, AI-assisted tools are helping engineers accomplish the task quickly, thus minimizing the requirement of large teams.
TCS had also undergone a significant workforce restructuring phase previously. It was reported that nearly 12,000 employees were affected during the last reorganization drive. Several workers receiving low performance ratings were reportedly hit by the process.
But apart from that, TCS is also concentrating on improving margins. Despite a slowdown in global tech spending, TCS is keen on increasing operational efficiencies and cost management. Recently, the firm reported pressure on its revenue growth amid declining demand for its products from international clients, particularly in banking, retail, and consulting industries.
The problem is not unique to TCS alone. Other leading Indian tech firms, such as Infosys, Wipro, HCL Technologies, and Tech Mahindra, are also facing pressure due to a slowdown in global tech spending and the adoption of AI.
