TCS calls for a tough restructure : Plans 2% workforce reduction in FY26 Says CEO
PharmaGenDrx News Bureau – 28th July, 2025
“One of the toughest decisions I have had to take as CEO”, Tata Consultancy Services (TCS) CEO K. Krithivasan said in a recent interview. TCS, India’s largest IT services firm is set to implement a measured restructuring of its workforce, in the financial year 2026 (Y26). At present, around 6,13,000 people are employed in the company as of Q1 FY 2026; therefore, about 12,200 people will be laid off as per the source, stating 2% reduction of its total workforce.
The CEO defends this initiative, expressing the need and commitment to being agile and future-ready, focusing on growth and internal mobility. Employees at a significantly primary level remain absolutely guarded from this fundamental shift, as this reduction targets middle and senior management positions. It was emphasised that the entire process of re-structuring would be handled with utmost care, especially to ensure that both clients and affected employees face little to no adversities.
The laid-off employees are said to have been receiving a notice period compensation, three months severance pay, along with outplacement opportunities to ensure a respectful and supportive transition. CEO K. Krithivasan acknowledged the constraints in harmonizing existing roles with the ever-evolving demands of dynamic enterprise priorities.
This organizational realignment follows economic uncertainty and a quest to optimize the marginal profits. This move is now said to fuel the other industries to do the same, following TCS’s footsteps. TCS has also delayed employing the lateral hires who have already received an offer letter in recent months. Along with this, RMG of TCS had announced the New Billability Policy, according to which, an employee must have 225 billable days and only be allowed 35 days of benching, to aim towards more productivity and client satisfaction.
The CEO also added that this step towards re-modelling was initiated to prevent decision-making delays, ensuring the company’s productivity by continuous meaningful project opportunities, professional growth benefits and value-driven recognition.
By Arundhuti Chatterjee & Sharon Bose
