CITU Demands Halt to Mass Retrenchment at TCS
THE Centre of Indian Trade Unions (CITU), in a statement issued on August 4, has unequivocally condemned the brazen and disastrous mass retrenchment plan of India’s largest IT company, Tata Consultancy Services (TCS), which is set to affect 2 per cent of its global workforce – over 12,000 employees across India.
This sudden attack has been unleashed upon the workforce at a time when TCS reported consolidated revenue of Rs 2,55,324 crore for FY 2024–25 – a 6 per cent year-on-year growth – and the industry’s highest operating profit margin of 24.3 per cent. During the same period, the company’s board approved a massive total dividend payout of Rs 45,588 crore – a 20 per cent increase over the previous year. Revenue per employee stood at Rs 42.45 lakh in FY25, reflecting a 15.8 per cent increase over the previous year. Meanwhile, the TCS CEO received a double-digit pay hike, with total compensation exceeding Rs 28 crore, even as the average employee was denied a wage hike.
The IT sector is a textbook example of the fanatical greed of the neoliberal capitalist system. IT workers in India generate a huge amount of surplus for their domestic and international employers and largely remain without any labour rights. Being predominantly global in nature in terms of capital and service flows, this sector’s workforce is highly vulnerable to adverse geopolitical developments. The US-led tariff war targeting Chinese and Indian tech equipment and services will certainly increase US input costs and reduce outsourcing margins. Given that the Indian IT sector is heavily outsourcing-oriented, it will be severely impacted.
This sector deals with some of the most modern and rapidly evolving technologies and, therefore, is among the first to face the blow of broader technological shifts. Increasing automation – especially the advent of artificial intelligence – is threatening to eliminate jobs such as coding. Rather than absorbing the impact through responsible measures, Indian firms like TCS are choosing to shift the burden onto employees.
TCS holds over Rs 47,000 crore in cash and cash equivalents, making it one of the most cash-rich private companies in India. Despite this massive reserve and years of robust growth, the company has opted to trim its workforce instead of using financial resources to protect its employees. This exposes TCS’s real agenda: profit maximisation, rather than industry sustainability and workforce protection.
Instead of taking a responsible approach, TCS management has started systematically targeting mid-level and senior employees under the guise of "skill fitment." Many of these experienced professionals have spent over 20 to 25 years at TCS and are now being forced out and replaced by freshers hired at salaries 80-85 per cent lower.
CITU reiterates that reskilling or upskilling of existing employees is the responsibility of the management. Shifting this responsibility to employees – denying them reskilling opportunities and forcing them out – is a violation of natural justice.
The simultaneous recruitment of new workers alongside mass retrenchment reveals the company’s aggressive “juniorisation strategy” – a deliberate policy to increase the share of freshers and reduce the cost of senior staff, all in the name of margin protection. Meanwhile, the income of top management has increased to obscene levels.
CITU notes with serious concern that the central government remains reluctant to even comment on the issue. The corporate-communal nexus at the centre continues to favour TCS with several public sector projects. TCS continues to receive government contracts worth thousands of crores – including for the BSNL 4G/5G rollout, the SPARSH pension system for defence pensioners, the Next-Gen Passport project, and the Digital Electoral Roll management. These projects are funded by taxpayers, yet the profits are siphoned off to corporate elites while jobs are being cut. The central government must intervene and initiate dialogue with TCS management to protect the livelihoods of lakhs of IT workers – those who provide critical services and contribute significantly to India’s foreign exchange earnings.
CITU clearly points out that forced resignations, threats of termination, increased work pressure, and manipulated performance metrics used as tools of informal retrenchment are in violation of the Industrial Disputes Act, 1947. Section 25N of the Act mandates prior government approval for the retrenchment of more than 100 workers in any establishment. TCS has circumvented this by pressuring employees into “voluntary exits,” thus depriving them of legal protections, compensation, and job security.
CITU demands that action be taken against TCS management under Section 25Q of the Industrial Disputes Act, 1947, for violating retrenchment procedures, and under Sections 25T and 25U for engaging in unfair labour practices. This issue is not limited to TCS alone – several other companies are also initiating retrenchments and layoffs.
CITU demands that tripartite meetings between IT companies, trade unions, and appropriate government authorities be convened to address the challenges facing the outsourcing-dependent IT sector due to the tariff war and other external factors.
CITU calls upon its affiliated unions and all IT workers to organise protest actions on August 19, 2025 in front of TCS offices across the country.
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