Tata Consultancy Services (TCS) reported a significant drop in its workforce in the second quarter (Q2 FY26), with the headcount falling by 19,755 employees. The total number of people on its rolls dropped to 593,314 on September 30 from 613,069 on June 30.
The reduction of nearly 20,000 employees is approximately 66 per cent more than the 12,000 planned layoffs (about 2 per cent of the workforce) the company had announced in July. The drop immediately fueled controversy as the company realigns its workforce amid changing business dynamics.
TCS explains the reduction
In a late evening investor call, newly appointed Chief of Human Resources (CHRO) Sudeep Kunnumal addressed the figures, attributing the drop to a combination of voluntary and involuntary attrition.
Involuntary Component: Kunnumal hinted that the involuntary component, or the number of employees who have been "released," stood at 6,000 and stated that the company is "halfway through its estimated reduction.."
Severance Cost: The CHRO also disclosed that the company incurred a Rs 1,135-crore hit on severance payouts.
The rationale: He explained the company's focus is on weeding out underperformers: "We continue to evaluate everyone... where we find that in mid and senior levels, people are not able to find the right role based on their seniority, those are the ones that we will release".
Care and support: Kunnumal claimed that the company is handling the process "sensitively," providing counseling, outplacement support, and severance at terms higher than industry standards.
Union accuses TCS of "corporate cruelty"
The Nascent Information Technology Employees Senate (NITES), an IT workers' union, swiftly challenged the company's explanation, accusing TCS of deliberately downplaying large-scale layoffs through underreporting and obfuscation.
NITES noted that the company had initially omitted total headcount and attrition figures from its standard Q2 earnings docket (a move later rectified in a website factsheet).
- Underreporting allegation: NITES President Harpreet Singh Saluja stated that the fact sheets "expose the truth." He alleged that nearly 8,000 employees "more than what TCS admitted, have disappeared from the rolls," pointing to a "deliberate attempt to downplay the scale of retrenchments".
- Alarming exit drivers: The union highlighted that the reduction is "deeply alarming" because overall attrition has actually fallen, suggesting that these exits were management-driven and involuntary, not voluntary.
- Cruelty claim: NITES further alleged that the company is "cornering, threatening, and discarding" employees with 10-15 years of loyalty. Saluja condemned the move, stating, "This is not restructuring, this is corporate cruelty. TCS has chosen profits over people…"
Context of the cuts
When the company first announced the layoff plans in July, it stated the decision was a result of a strategy to become a "future-ready organisation," focusing on investments in technology, AI deployment, market expansion, and workforce realignment—only the second time in its history the company has announced such a move.
