TCS had to spend Rs 1,135 crore on restructuring. The company has stated this in its September quarter results. It has said that it had to spend Rs 1,135 crore on restructuring in the second quarter of this financial year. The reason for this is the company’s decision to fire many employees. The company has also made changes in the roles of many employees. The company had to pay compensation to the laid-off employees. TCS is the largest IT company in India.
The company announced the results on 9 October
This Tata Group company (TCS) announced its September quarter results on 9 October. The company told the stock exchanges that the restructuring expenses had an impact on its consolidated net profit. It stood at Rs 12,075 crore with a slight increase. The company has described this expenditure as an exceptional item. The company’s revenue in the September quarter stood at Rs 65,799 crore. This is 3.7 percent more than the June quarter. In constant currency terms this is 0.8 percent growth. This is slightly lower than analysts’ estimates. In the CNBCTV-18 poll, the company’s profit was estimated to be Rs 12,528.3 crore. Revenue was estimated at Rs 65,114 crore.
The CEO of the company had told about the layoff plan 2 months ago
TCS’s restructuring spend of Rs 1,135 crore comes two months after its CEO Krittivasan told Moneycontrol that the company would reduce its employee strength by 2 per cent. This means that the company plans to lay off about 12,000 employees in this financial year. The company is reducing the number of mid and senior level employees in a phased manner. There is panic among the employees due to this step of the company. This has affected the employees of entire IT industries.
Employees unions claimed large number of layoffs
TCS employees and IT employees union claim that the actual number of laid off employees is much higher. They allege that to make the number of retrenchments look less, many employees are being asked to resign themselves. In the last few months, many employee unions have protested against this. These include All India IT and ITES Employees Union (AIITEU), Forum for IT Employees (FITE) and Union of IT and ITES Employees (UNITE).
Company spokesperson rejected the unions’ allegations
Employees unions say that employees are being forced to resign. They are being forced out of their jobs. A source close to the company rejected these claims. He called it wrong and misleading. TCS spokesperson said that as mentioned earlier, the impact of layoffs is only on 2 percent of the employees.
Now total 6.13 lakh employees in the company
The number of TCS employees decreased by 19,755 in the second quarter. The company said in its September quarter results that its total number of employees is now 6,13,069. TCS had increased the number of employees by 5,090 in the June quarter. The attrition rate in the company fell to 13.3 percent in the September quarter. It was 13.8 percent in the June quarter.