TCS new benching policy: Employees face uncertainty and fear layoffs

As the first phase of the new benching policy at TCS, India’s largest IT services company, concludes, employees are anxious about layoffs. Many of TCS’s employees seem to be sharing their worries pertaining to the company’s layoff policies on Reddit. The newly instituted policies, which took effect on June 12, 2023, reduce the non-billable period to 35 days in a year. If employees go beyond this non-billable period, they may be subject to professional penalties, or, in the worst case, face job termination. An ET report suggests that employees have been dealing with a myriad of challenges, which include urgent project scrambling, under/over skill level client interviews, and fighting to get project placements in their desired locations. One concerned Reddit user was quoted as saying, “This is the first step towards employment rationalisation based on utilisation. Brace for layoffs.” Another user had this to comment, “I just started with TCS. The company trained me in Java. Now, not even a month into my bench period, RMG wants me in a support project, a field unconnected to Java and Python.” However, the financial daily was unable to verify the accuracy of the claims on Reddit.

What is the TCS Benching Policy?

Discussing the revised bench policy, TCS Chief Executive and Managing Director K. Krithivasan said the following to Times of India: “It has always been an expectation that an associate manages their career progression. While HR has a role in sustaining a project's placement, it is in our shared expectation that associates take on new roles and actively apply for them upon completing roles.”This quote summarises the policy in place: sustained proactive, self-driven career management for associates. “We aim to minimise bench time.” The policy underscores the company s sustained and substantial investment in employee development. “Once we've made that investment, we work to ensure associates are deployed,” he further explained. “While preferences are considered, projects are driven by client needs. We deploy based on training, demand, and skill alignment. If there are gaps, we work to address them beforehand.” Krithivasan said TCS did not respond to his question concerning salary suspension for employees deemed to be on an extended bench period.

Effects Of TCS Policies On “Bench” Employees

With TCS being one of the largest employers in the Indian IT sector, having over 613,000 employees, the company is yet to clearly define the impact of the TCS policies bench employees. As is common in the sector, it is typical for around 15-18% of the workforce to be benched. The impact of the bench policy, unfairly labeled as “inhumane” and “exploitative” was the focus of an appeal made to the union labor minister, Mansukh Mandaviya. This appeal was made by a workers’ rights organization. NITES, the Nascent Information Technology Employees Senate, made the claim that TCS is unduly frightening benched employees by revoking experience certificates if post assignments were not obtained in a given time period. As a result, employees are forced to subcontract within unfair deadlines to prove their value.

Saluja, the president of NITES wrote to the labor minister that “These are not non-performing employees, but skilled professionals who find themselves temporarily without allocation…” and said that instead of being provided the common sense help, these employees face and unmatched policy of suspicion, coercion, and threats.” Some of the staff members, however, have backed TCS, suggesting that the numerous unassigned employees for long periods of time were not accepting available projects. Further, “This may help TCS trimming some seriously underperforming resources, those stuck on TCS like a leech,” a Reddit user stated.

TCS Benching Policy: Impact on the Industry

The impact of artificial intelligence (AI) automating repetitive tasks will bring fundamental shifts to the IT industry. As core areas of operations undergo automation, *Pareekh Jain*, founder and CEO of EIIRTrend, shared his insight by saying, *“IT companies to become stricter with their bench policies due to the soft business environment and AI-led demand for advanced skill sets”. Jain also noted that staff costs heavily influence the IT company’s profit margins. According to industry experts, TCS’s strict bench policy is likely to encourage other IT companies to follow suit, as the AI-utilized productivity surge causes more difficulties in reallocating entry-level engineers. “Technology companies need to upskill or reskill their employees due to evolving needs of the clients. By changing their bench policies, companies are encouraging employees to reskill in areas like AI, cybersecurity, and digital engineering,” commented Nitin Bhatt, a technology sector leader at EY India, as quoted by the financial daily. “Going forward, promoted tenure and grade along with merit-based increases will likely be replaced by skill-based assessments in those areas requiring adaptability to new roles.”