Tata Consultancy Services (TCS) has concluded its year-long workforce reorganization, resulting in around 8,000 redundancies. This is about 25% lower than the 12,000 reduction it had initially projected, signaling a calibrated shift rather than an aggressive cut.
As part of its aim to transform into a ‘future-ready organization,’ TCS had already hinted at a reorganization of the company involving nearly 2% of its total human resources worldwide, mainly mid- and senior-level workers, based on a total of more than 600,000.
The initiative was carried out in Q3FY26 and cost the company Rs. 1,388 crore. Nearly 6,000 employees left in Q2FY25, while the rest of the restructuring took place in the next quarter. As per TCS, reskilling remained its focus, and exit policies were applied only to roles that could not be integrated into the new organizational structure.
There has been a parallel change in TCS’s hiring process. The company has switched from an earlier benchmark-based approach to a demand visibility approach. Now, its hiring decisions depend entirely on the availability of confirmed project pipelines.
This shift is evident even in terms of campus recruitment, where TCS has hired about 44,000 fresh recruits in FY26. Currently, demand visibility is around 25,000 hires.
The shift mirrors broader transformations affecting the entire IT services sector. Companies now concentrate their efforts on achieving results and increasing productivity, leading them to maintain their workforce at 80 to 88 percent of existing capacity, up from the previous 60 to 70 percent standard.
The need for professionals with skills in AI, data, cloud, and cybersecurity is increasing, while traditional employment positions like L1 support and testing have started to decline. Freshers with AI capabilities are now commanding salaries between Rs. 6 lakh and Rs. 12 lakh annually, marking a clear premium in the talent market.
TCS added 2,356 employees in the March quarter, taking total headcount to 584,519. Attrition edged up to 13.7%, above its preferred 10–12% range, reflecting ongoing churn across the sector.
The company has suspended multiple workers at its Nashik facility because of sexual harassment and religious misconduct allegations against them. Police have filed multiple FIRs, resulting in the arrest of several employees.
The company said it has implemented immediate measures and is working with law enforcement agencies to investigate the incident, in accordance with its zero-tolerance policy for workplace misconduct.
The reorganization marks a deeper shift in how TCS approaches talent, leaner teams, sharper skills, and tighter alignment with demand. At the same time, operational and governance challenges continue to test execution on the ground.