Tata Consultancy Services (TCS) India’s largest IT services firm announced a significant workforce reduction, triggering widespread concern across the Indian IT sector. The company said it would cut about 2 % of its global workforce, affecting around 12,000 to 12,200 employees. According to TCS, the cuts are aimed primarily at middle- and senior-level roles as part of a strategic workforce realignment.
Reasons and Rationale
TCS frames the layoffs as a move toward becoming a future-ready organization, aligning talent with evolving technology demands. The company cites skill mismatches, changes in client demand, global macro pressure, and the increasing use of artificial intelligence and automation as contributing factors. TCS has also emphasized that service delivery to clients would not be affected by the restructuring. Simultaneously, the company has committed to wage hikes for about 80 % of its remaining workforce (grades up to C3A), effective September 1, 2025.
Controversies and Pushback
Unions and employee groups have strongly criticized TCS’s approach. The Centre for Indian Trade Unions (CITU) and the Karnataka IT / ITES Employees’ Union (KITU) have alleged that TCS is forcing resignations under thinly veiled retrenchment, violating India’s Industrial Disputes Act (IDA). The unions urge legal action and seek greater transparency. In many reports, employees claim the process has been opaque, with “fluidity lists” (i.e. lists of employees deemed potential layoff candidates), pressure to resign, and alleged HR harassment. Some workers say their termination was sudden, with little notice, and severance has not always been clearly communicated.
There is also a debate over the actual magnitude of job losses. While TCS maintains the figure at 12,000, unions and some employee sources claim the real number could be 30,000 or more, since many resignations (or forced exits) are not formally recorded as layoffs. Speculative reports about up to 80,000 job cuts have circulated widely, which the company has officially “dismissed as misleading and inaccurate.
Market, Sector, and Analyst Viewpoints
On financial markets, TCS’s announcement led to a modest drop in share price roughly a 1.7 % decline reported. Analysts warn that while cost rationalization is understandable, the timing and scale carry risks of morale decline, attrition, and execution challenges. Jefferies specifically flagged that this is the third significant cost-cutting move by TCS over a few months and cautioned about attrition pressures and disruption risks. Observers also interpret TCS’s move as emblematic of a larger trend: AI-driven disruption in the global IT and outsourcing industry. Some analysts suggest that half a million IT jobs could be at risk in India over the next 2 to 3 years.
Human Impact and Reactions
On social media and in employee testimonials, there is palpable anxiety. Many share stories of humiliation, emotional distress, and a sense of loss of job security. Some employees express frustration at being judged on performance metrics or bench time rather than context. Protests have also erupted particularly in cities like Chennai led by the union UNITE, demanding that TCS rescind the layoffs or at least provide fairer treatment to impacted staff.
What the Speculation Says
Some social media posts and reports claim that up to 80,000 employees have been laid off or asked to resign from TCS far higher than the officially announced figure. These claims include allegations that severance terms varied widely some employees reportedly being offered 18 months’ salary, others only 3 months, and some none at all.
What TCS Says
TCS has rejected the 80,000 figure, calling it incorrect and misleading. The company states the impact is limited to about 2% of its workforce, which roughly corresponds to 12,000 to 12,200 jobs. In its announcements, TCS has said that the cuts are primarily in middle and senior grades, where deployment was challenging or skills mismatch was identified.