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Is TCS Really Laying Off 30,000 Employees? Here’s What the Company Said

Rahul Asati Image

Rahul Asati

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Table Of Contents
  • Union’s Allegation
  • Company’s Clarification
  • Why Restructuring Is Needed
  • Industry Context
  • Key Takeaways for Investors

India’s biggest IT services firm, Tata Consultancy Services (TCS), is in the spotlight after reports of mass layoffs created panic. While the employees’ union claimed that as many as 30,000 jobs are at risk, the company has strongly denied this, calling the figure misleading. Instead, TCS says it is restructuring in a limited and planned manner that will affect around 12,000 employees, which is about 2% of its global workforce.

Union’s Allegation

  • The IT employees’ union UNITE staged protests across several Indian cities, accusing TCS of planning the biggest layoff (30,000 employees) in the company’s history. 
  • The union warned that such a decision would hit thousands of families and even announced plans to take the protest global.
  • For employees, the allegation was worrying. Many linked it to fears of AI-driven job losses, a hot topic in the industry right now.

Company’s Clarification

  • TCS was quick to respond and said there is no plan to cut 30,000 jobs, and that the restructuring is much smaller in scale.
  • The company confirmed that around 12,000 roles will be phased out, mainly where skill mismatches exist.
  • The company stressed that this is not a sudden or harsh decision. Instead, it is part of efforts to make the workforce future-ready. Read more about company previous announcement on layoff here.
  • To ease the transition, TCS has promised, Notice-period pay, severance package, counselling support and outplacement help for affected staff

Why Restructuring Is Needed

The IT industry is changing fast. Clients want expertise in areas like cloud computing, cybersecurity, and artificial intelligence. TCS has trained lakhs of employees in new technologies, but not all roles fit the evolving requirements.

The company believes this restructuring will make it leaner, more agile, and better prepared for the future. For a company of over 600,000 employees, a 2% adjustment, though significant, is not unusual.

Industry Context

TCS is not alone. Globally, many IT firms are reviewing their workforce strategies. With tighter budgets and rapid tech adoption, companies are focusing on efficiency and skill alignment rather than simple headcount growth.

In India, however, any talk of layoffs quickly sparks debate because the IT sector is one of the country’s biggest employers. That is why the difference between the union’s claim of 30,000 cuts and the company’s clarification of 12,000 has attracted so much attention

Key Takeaways for Investors

  • Layoff Scale Smaller Than Feared: TCS has clarified that around 12,000 roles, or 2% of its workforce, will be impacted instead of the 30,000 claimed by the union.
  • Restructuring Is Efficiency-Focused: The restructuring is aimed at improving efficiency, addressing skill mismatches, and supporting long-term margins.
  • AI Concerns Overstated: The company has stated that the move is not driven by AI automation, positioning the move as a skill realignment helps reduce investor worries about sudden, large-scale tech disruption.
  • Employee Morale a Watchpoint: Employee morale and ongoing union protests could still pose risks if not managed carefully.
  • Market Reaction Steady: TCS shares are trading flat, up about 0.5%, reflecting investor confidence in the company’s strategy.
  • Industry-Wide Signal: Other IT majors such as Infosys, Wipro, and HCL Tech may follow with similar restructuring steps.

Disclaimer
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