TCS appraisal shake-up: Managers reportedly asked to place 5% employees in lowest rating band

Tata Consultancy Services (TCS), India's leading IT services firm, is reportedly mandating its managers to designate at least 5% of employees as underperformers in the latest appraisal cycle, according to a report from Mint. An internal communication from a TCS HR executive to a business unit head revealed that managers are being instructed to critically assess and compile a list of associates eligible for the 'Band D' classification, which signifies the lowest performance rating. This directive comes on the heels of TCS's significant workforce reduction earlier this year, which saw nearly 2% of its employees laid off. Many of those affected were identified as underperformers within the organization. Currently, TCS employs approximately 584,519 individuals worldwide. Reports indicate that business unit heads have already categorized around 17,500 employees, or about 3% of the total workforce, as underperformers. Last fiscal year, TCS announced a reduction of approximately 12,200 roles, equating to around 2% of its employees, focusing primarily on middle and senior management as the company pivots towards operations driven by artificial intelligence and other advanced technologies. During this transition, TCS emphasized its commitment to retraining and redeploying affected employees, ensuring that service delivery remains unaffected. The company acknowledged the challenges faced by employees during this period, expressing gratitude for their service and pledging to provide appropriate support, including outplacement assistance and counseling as they navigate new opportunities. In its most recent quarterly results, TCS reported a modest increase of 2,356 employees, bringing its total workforce to 584,519, although it still reflects a year-on-year decline of 23,460 from the previous year's total of 607,979. Additionally, the company noted a rise in its voluntary attrition rate to 13.7% over the last twelve months.