Bengaluru: Tata Consultancy Services (TCS) has implemented a tiered severance package impacting approximately 12,000 employees, primarily targeting mid- and senior-level executives. This decision is part of a significant workforce realignment as the company increases investments in artificial intelligence (AI), data management, and cybersecurity, while phasing out roles that cannot be redeployed within the organization. The announcement has sparked considerable uproar on social media.
Severance Package Details
The severance package extends to employees at all levels, including those on the bench or lacking the requisite new skills, as well as long-tenured staff with over 15 years of service.
- Job Cuts and Payouts:
- Employees with 10-15 years of service will receive 1.5 years’ pay.
- Those with over 15 years will be compensated with two years’ pay.
For employees whose skills have become redundant or those who did not upskill in alignment with the company’s evolving technological needs, TCS is offering a three-month notice period pay, alongside a severance package ranging from six months to a year’s salary, depending on their tenure. The minimum severance payout is set at six months’ salary.
Support for Affected Employees
To facilitate a smooth transition for affected employees, TCS will cover outplacement agency fees for up to three months, extending this support for junior associates. The company is also continuing its mental health support initiative, TCS Cares, which provides funded access to therapists for short- to medium-term counseling.
Employees who have been on the bench or unallocated for over eight months will receive the standard three-month notice period pay.
Options for Nearing Retirement Employees
For those nearing retirement, TCS has provided an option for early retirement, which includes full access to retirement benefits and insurance, along with an additional severance payout ranging from six months to two years’ salary, again depending on tenure. Employees who have been with the company for longer periods will receive more generous terms; specifically, those with 10 to 15 years of service will be compensated with 1.5 years’ pay while those with over 15 years will receive two years’ pay as part of their severance package.
This move by TCS illustrates the company’s strategic shift towards technological advancements while also ensuring that affected employees receive adequate support during this transition.
