TCS Employees Count Drops Nearly by 20,000 in Q2FY26 Amid Restructuring

Tata Consultancy Services (TCS) reported a drop in its employee count to 593,314 in the second quarter of the financial year 2025-26. This is a decrease of 19,755 from 613,069 at the end of the previous quarter. The reduction follows layoffs of about 12,260 employees announced in July, 2025.

Severance and Support

The company spent ₹1,135 crore on severance during the quarter. Employees affected by layoffs were provided with benefits, counselling, and transition support. Around 500 US-based employees on H-1B visas were also part of workforce localisation efforts.

Salary Increments

TCS provided salary increases to 80% of its workforce in Q2FY26. According to CFO Samir Seksaria, the increments along with quarterly variable allowances reduced margins by 70 basis points. This was partially balanced by a 40-basis-point benefit from rebalancing the employee pyramid and 20 basis points from operational efficiency improvements.

Attrition and Diversity

Voluntary attrition decreased slightly to 13.3% from 13.8% in Q1FY26. The share of women employees rose to 35.2% from 35.1% in the previous quarter. TCS stated that the headcount reduction included both voluntary and involuntary exits.

NITES Criticism on Numbers

The Nascent Information Technology Employees Senate (NITES) highlighted that around 8,000 employees were not accounted for beyond the reported layoffs. They said the difference between total headcount reduction and official layoffs indicates some exits were management-driven rather than voluntary.

Read More: TCS Announced Interim Dividend of ₹11: Fixed October 15 as Record Date!

Previous Layoffs

This is the second major layoff in TCS’s history. The first was in 2012, when about 2,500 employees were let go for underperformance. Earlier in FY26, TCS had added 5,090 employees in Q1, showing fluctuations in workforce size amid restructuring.

TCS Share Price Performance

As of 10 October 2025, 12:04 PM, Tata Consultancy Services Ltd (TCS) share price was trading at ₹3,024.20, a 1.22% decrease from the previous closing.

Conclusion

The workforce decline in Q2FY26 shows TCS’s ongoing restructuring. While salary increments continued and voluntary attrition fell slightly, the overall reduction in employees is significant for the company.

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