TCS sounds final call for staff to work from office

MUMBAI: Tata Consultancy Services (TCS) has extended the period by which employees should return to office by another quarter, to March end, but has informed them that this will be the last deadline for doing so. Failure to resume work from office (WFO) by then will lead to “consequences,” chief operating officer NG Subramaniam, told ET, citing work culture as well as security issues.

“We are exercising patience but have taken a principled stand that employees have to get back to offices,” he said. “We have sent employees the final communication on this and if they do not, there will be consequences to face.”


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He said working from home made employees and employers vulnerable.

“With the kind of cyberattacks in today’s context, an organisation can inadvertently get into trouble,” he said. “One cannot have the kind of controls at home and there can be security risks to businesses.

In the fiscal third quarter, India’s second largest IT firm Infosys said one of its US units was affected by a cyber security issue, resulting in the unavailability of several applications. In December, HCLTech reported a ransomware incident, adding that it had made no impact.

TCS is aiming to revive the pre-pandemic work culture in a shift away from the 25-by-25 hybrid model it had announced during the Covid-19 outbreak. It had said in 2020 that once all employees returned to office, a fourth of them would work from home by 2025.

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At the December quarter earnings announcement on January 11, the company said 65% of the workforce had been coming to the office up to three days a week.

“We are very clear that we have to get our original culture back,” Subramaniam said. “Around 40,000 employees joined us online and quit online without any offline interaction during the pandemic and that kind of situation cannot be helpful to an organisation.”

The company’s headcount increased by over 167,000 between April 2020 and October 2023 during a period of heightened churn in the industry. However, staff additions went into the negative in subsequent quarters as the company sought to tame high employee costs.

Responding to the issues of attrition and employees’ trust deficit in IT companies, Subramaniam said it’s a question of security and confidentiality.

“Also, an organisation can only build a pool of talent when there is face-to-face interaction to make leadership calls,” he said. “We are not in a business where employees use TCS as a launch pad. Remote working cannot help an organisation build a great culture.”

In June 2022, the company said 25,000 employees had joined and quit before visiting any office. As of January 2023, the company reported its highest-ever attrition rate of 21.5%, which dropped to 13.3% in the December quarter.

In the third quarter, TCS ended with 603,305 employees, a decline of 5,680. That compares with a dip of 6,333 in the second quarter, its biggest drop in numbers since the 2008 crisis, as the company slowed down hiring.

As employees return to offices, the company expects to be back to its “normal operating mode by the end of the current fiscal year,” chief HR officer Milind Lakkad had said at the earnings conference.

Bringing employees back to the office has increasingly become an industry-wide challenge. TCS’ peers also reported similar issues in encouraging more footfalls on campuses. Most companies have implemented a roster system requiring up to three days in the office.

While TCS has started campus visits, peers such as Wipro and Infosys are staying away from colleges.

The Indian IT services sector is showing some signs of revival with a 10% increase in hiring intent as of January end, recruitment experts told ET. This comes after the macroeconomic slump in 2023 led to a headcount correction last year. Just in the last quarter, the top five companies reported a headcount drop of over 61,000 from the year earlier.

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Harry Byrne

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