‘Mass sacking dressed in corporate jargon’: The fall of TCS from grace and the stock market

“Silent firing going on, they don’t want TCS shares to go down if they make public layoffs,” read an anonymous answer to the question “Has TCS started firing mid-level employees like C3 associates?” on job review portal Glassdoor three days ago. However, not only have the layoffs at Tata Consultancy Services gone public, but they have also led to a major dip in the company’s brand value and stock price.

IT employee union, the Nascent Information Technology Employees Senate (NITES) wrote to Union Labour Minister Mansukh Mandaviya this Monday, calling the TCS layoffs “unethical” and “outright illegal”.

“This is a mass sacking dressed in corporate jargon...If a company of TCS’s scale is allowed to carry out mass layoffs without following due process and without consequences, it will set a dangerous precedent for other companies,” NITES President Harpreet Singh Saluja wrote in the letter to the minister.

High attrition ahead, TCS stock down to 52-week low

The stock market was quick to punish TCS as the shares of the Sensex constituent have been steadily falling—it hit its 52-week low of ₹3,041 per share today (July 29) after sliding 1.15 per cent in morning trade. In the past month, TCS stock has dipped close to 12 per cent. In the past six months, it slipped by more than 25 per cent.

The recent layoffs at India’s largest IT services company (which ironically has no product to show for itself) are expected to hit 12,261 employees—two per cent of its global workforce this year. At the end of June 2025, the TCS employee count was 6,13,069, after adding 5,000 employees in the April-June quarter.

In the letter, the NITES President accused TCS of not complying with any of the government’s requirements, calling it a “blatant” and “wilful violation” of the law. “The law clearly states that no employee who has served for over a year can be retrenched unless the company provides one month’s notice or wages in lieu, pays statutory retrenchment compensation, and notifies the government,” the letter read.

Ratings firm Jefferies, in its report TCS layoffs - A canary in the mine?, theorised that the recent TCS layoffs could lead to “execution slippages” in the near-term and “higher attrition” in the longer run.

So far, TCS has enjoyed low employee attrition due to its promise of job security, despite pushing out shoddy (and sometimes disrespectful) salaries.

“The move by TCS reflects its growing focus on conserving margins amid continued growth pressures and is the third such move in the past three months after deferral of wage hikes in April 2025 and the benching guidelines introduced in June 2025, which restricted the non-billable period of an employee to 35 days a year,” Jefferies said.

Jefferies’ note further stated that, despite not being the best paymaster, TCS has enjoyed lower-than-industry attrition levels, as it offers a long-term career path and job stability to its employees.

” In the near term, the ongoing layoffs will hurt employee morale and could potentially lead to execution slippages. In the longer run, such policies could drive a sharp rise in attrition, similar to what was seen at Cognizant during 2020-22,” read the Jefferies report.

Meanwhile, industry body Nasscom brought out one of the most impersonal and diplomatic responses to the TCS debacle, even omitting the company’s name from its commentary.

“Over the next several months, we anticipate some transitions as organisations pivot toward product-aligned delivery models, driven by rising client expectations around agility, innovation, and speed. This shift is likely to reshape traditional service delivery frameworks and, in the near term, may lead to some workforce rationalisation as traditional skillsets are re-evaluated”, read the robotic statement from Nasscom.

Instead of calling out the unethical and unceremonious layoffs, Nasscom simply said: “Hiring trends will continue to evolve, with increasing demand for deep, specialised expertise. There is no one-size-fits-all solution; each enterprise will navigate this transition based on its unique strategic needs.”

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