Infosys Slashes Employee Bonuses Before Pay Hikes – Here’s How Much They Will Get

Infosys, one of India’s leading tech giants, is reportedly slashing employee bonuses ahead of its scheduled annual salary hikes. The company has decreased the bonus payouts to around 80% of the target for Q3, impacting staff in its delivery and sales divisions, which make up a significant portion of its 323,000-strong workforce.

Reduced Bonuses Ahead of Pay Hike in March

In a move that has caught the attention of employees, Infosys is disbursing smaller bonuses for the quarter ending December. As per an ET report, variable pay for staff in key departments like delivery and sales has been reduced by 5-10% compared to the previous quarter. Employees received an average of 80% of the target bonus, with a notable dip from the 100% bonus some had received in the previous quarter.

Infosys’ communication to employees emphasized that the company is focusing on building a high-performance work culture and has continued to differentiate pay based on performance. “We have continued to drive performance differentiation while closing bonus pay-outs,” stated the company.

Impact on Delivery and Sales Teams

According to insiders, the dip in bonuses primarily affects employees in the delivery and sales divisions, which represent the majority of Infosys’ workforce. In the July to September quarter, employees received around 85% of their variable pay, but this time, it has dropped further, averaging 75% at the unit level rating.

Employees in higher positions such as managers and senior managers (JL6+) received an average of 70-85% of their expected bonuses, depending on their performance ratings. Those with an “outstanding” rating received the full 100% payout, while others received varying percentages based on their performance evaluations.

Infosys Conserving Funds for Pay Hikes

While the reduction in bonuses has left many employees disappointed, it appears that Infosys is conserving funds for the upcoming salary revisions, set to take effect in March. One employee mentioned, “There has been a 5-10-percentage-point drop compared to last quarter, when some people even got 100% of the performance bonus. It looks like Infosys is conserving funds to fund pay hike expenses.”

TCS Salary Hikes Expected in March

In contrast, Tata Consultancy Services (TCS), India’s largest IT services company, is set to roll out its salary hikes for FY25 in March. Sources suggest that salary increments will range between 4 to 8 percent, depending on the employee’s grade and business vertical. This news follows TCS’s recent quarterly variable pay release, where senior-level employees faced reduced payouts, while junior and mid-level employees received their full variable pay.