TCS Hikes Q4 Variable Pay to 60-80% for Mid-Level and Senior Employees; Ties Monthly Variable Pay to Attendance

Tata Consultancy Services (TCS) has begun disbursing quarterly variable allowances (QVA) for the March quarter, with a significant number of mid-level and senior employees receiving payouts ranging between 60% and 80% of their eligible variable compensation, as per The Moneycontrol report.  

The payout levels continue to be influenced by both attendance compliance and business performance metrics. 

Attendance Compliance Continues to Influence Payouts 

The company has maintained its policy of linking quarterly variable pay eligibility to employees' work-from-office attendance levels.  

Employees who failed to meet the prescribed attendance benchmarks received reduced payouts despite being eligible for variable compensation. 

According to the report, several staff members received only around 50% of their variable pay, largely because their office attendance remained close to 60% during the evaluation period. 

Under TCS' existing framework, employees with less than 60% office attendance are not eligible for any quarterly variable allowance.  

Those maintaining attendance between 60% and 75% qualify for 50% of the eligible payout, while employees with attendance between 75% and 85% receive 75% of the variable component.  

To qualify for the entire quarterly payout, employees are expected to maintain a minimum 85% office attendance. 

Business Performance Remains a Key Determinant 

While attendance plays a significant role, payout levels also continue to depend on business performance. Employees indicated that performance-linked variable compensation has remained under pressure over the past two years despite compliance with office attendance requirements. 

The company has previously stated that quarterly variable compensation is determined based on the performance of an employee's respective business unit, in line with its standard practice followed across quarters. 

Salary Increments Rolled Out for FY26 

TCS has also become the 1st major Indian IT services company to implement salary revisions for FY26, effective from April.  

Alongside the increment cycle, the company introduced a revised cost-to-company (CTC) structure to align compensation practices with provisions under the new Labour Codes. 

Employees reported an average salary increase of roughly 5% during the latest appraisal cycle. Increment levels varied depending on performance ratings.  

Employees in the A+ category indicated salary increases ranging between 9% and 13%, while those in the A band largely received hikes in the 5% to 9% range. 

Staff members rated in the B category reported increments of approximately 1% to 3.5%, whereas several employees in the C band said their salary revisions were minimal or, in some cases, negative. 

Read More: TCS and Siemens Energy AG Announce Strategic AI Alliance for Operational Excellence! 

TCS Share Price Performance 

As of 22 May 2026, TCS share price closed at ₹2,317.30 per share, reflecting a decline of 0.43% from the previous closing price. 

Conclusion 

TCS' latest variable pay cycle reflects the company's continued emphasis on attendance compliance and business performance as key determinants of employee compensation. Alongside quarterly payouts, the company has also commenced FY26 salary revisions, with increment levels varying significantly across performance bands. 

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