Undeclared work is an ethical issue, says TCS HR manager

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  • TCS reported an increase in attrition rates in the September quarter – at 21.5%, this was the highest rate in the last six quarters.
  • Overall, the company’s workforce stood at 6,16,171, with a net addition of 9,840 employees.
  • The computer science major says that while attrition has likely peaked, compensation expectations for experienced professionals are also moderating.
  • Milind Lakkad, human resources manager at TCS, also spoke about moonlighting, calling it an “ethical issue”.

Attrition rates for major IT TCS worsened in the September quarter, in line with analysts’ expectations. However, the company believes that attrition has peaked and compensation expectations for experienced professionals have also moderated.

However, the company explained that attrition rates will not drop significantly anytime soon.

“We believe our annualized quarterly attrition peaked in the second quarter and should decline from there as compensation expectations for experienced professionals moderate,” said Milind Lakkad, the company’s chief human resources officer.

Overall, TCS’ total workforce was 6,16,171, with a net addition of 9,840 employees in the September quarter. The company hired 20,000 freshmen in the second quarter, a 33% increase from the previous quarter.

Its new hires, however, have slowed – it hired 35,000 new employees in the first half of FY23, compared to 43,000 in the first half of FY22. Previously, TCS had set a goal of hiring 40,000 freshmen in FY23. At the current pace, it looks poised to comfortably cross that number.

In terms of attrition rates, this is TCS’ worst quarter, at least in the last six quarters.

Trimester Attrition rate
Q1 FY22 8.6%
Q2 FY22 11.9%
Q3 FY22 15.3%
Q4 FY22 17.4%
Q1 FY23 19.7%
Q2 AF23 21.5%

Source: Company Reports

Analysts expect attrition rates to decline towards the end of the year, but that’s more due to a significant drop in demand, according to a report from ICICI Securities.

Lakkad’s statement that expectations for professional compensation should also ease.

“Undeclared work is an ethical issue”



Lakkad also spoke about moonlighting – a controversial topic with mixed opinions – saying it’s an ethical issue.

High attrition rates of late have put an emphasis on moonlighting – a practice where one person works multiple jobs. Wipro Executive Chairman Rishad Premji even called it “outright cheating.”

One of the main reasons why people are multi-jobbing could be the fact that average wages have declined – from ₹4.54 lakh in the first quarter of FY22 to ₹4.5 lakh in the first quarter of FY22. fiscal year 23, despite a spike in inflation.

Another oft-cited reason is that additional employment builds employee skills – companies try to counter this by increasing internal training programs and learning opportunities.

“In the second quarter, TCSers logged 11.7 million hours of learning, which resulted in the acquisition of 1.5 million skills,” the company said in a press release. Interestingly enough, despite the increase in numbers, its learning hours were down from the previous quarter, which was 12 million.

TCS reported a 10% sequential increase in net profit, to ₹10,431 crore, with net margin improving to 18.9% over the period. It declared a dividend of ₹8 per share.

SEE ALSO:

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