Tata Consultancy Services (TCS), India’s IT giant and the largest exporter of IT services, has recently confirmed the release of around 1% of its workforce. TCS Chief HR Officer, Sudeep Kunnumal, clarified the numbers on Thursday, stating that approximately 6,000 employees were impacted, far fewer than rumours suggesting 50,000 to 80,000 layoffs.
'Many of the reported numbers are not factual and are extremely exaggerated,' Kunnumal emphasised. He also assured that TCS is 'not chasing a number' but making strategic workforce adjustments to meet evolving business demands.
According to a statement from IT workers' union NITES, TCS's workforce declined from 613,069 employees in Q1 FY26 to 593,314 in Q2 FY26, marking a net reduction of 19,755 employees in just one quarter. Kunnumal clarified that the recent layoff wave primarily affected mid and senior-level staff who could not be redeployed within the organisation.
TCS has structured a comprehensive severance program for the impacted staff, mostly in leadership and mid-management roles. The packages vary depending on employee tenure and skill relevance:
- Unassigned employees or those whose skills became outdated received three months' notice period compensation.
- Additional severance ranged from six months to one year's salary, based on length of service.
- Employees with over 15 years of service were also included in the compensation structure.
This program aims to support employees while allowing TCS to integrate AI technologies and other business-driven changes efficiently.
TCS has a history of strategic workforce management. In 2014-15, the company reduced over 3,000 positions, approximately 1% of its staff, to better align with evolving industry requirements. Similarly, the July 2025 reduction affected 12,261 positions (about 2% of staff), reflecting the impact of AI disruption and uncertain market conditions.
The layoffs mainly affect mid and senior management, signalling a major organisational transformation. TCS continues to focus on skill-based redeployment, ensuring employees are equipped for future roles where AI integration and technology-driven services are crucial.
Kunnumal concluded, 'We aim to manage workforce transitions thoughtfully, ensuring those impacted receive fair support while positioning the company for the future.'
What This Means for IT Professionals:- Upskilling is critical: AI integration is reshaping IT roles, making continuous learning essential.
- Career planning: Mid and senior-level professionals should explore alternative roles or skill upgrades proactively.
- Industry trends: TCS's move reflects a broader trend in the IT sector, where workforce optimisation aligns with technology adoption.
TCS continues to be India’s most profitable IT services exporter, demonstrating resilience despite global economic uncertainties. For employees and industry watchers, these layoffs highlight the importance of adaptability and strategic skill development in the rapidly evolving IT landscape.
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