Top employees at the country’s fourth-largest information technology (IT) services company can expect pay increases of about 8% on average, two company officials told Mint on condition of anonymity, making this year’s raises better than last year’s average of about 6%.
About three-quarters of Wipro’s 200,000 offshore employees who work away from client locations can potentially get a nearly 8% raise, while those working from client locations could get a 3% increase in their pay, according to the first of the two officials cited above.
“We are pleased to inform you that our Merit Pay Increase (MSI) cycle will be effective from September 1, 2024, less than 12 months after the previous MSI,” reads an internal email sent by Saurabh Govil, Wipro’s chief human resources officer, to employees on August 29 and seen by Mint.
Wipro normally gives out salary hikes during September and October but had delayed it last year before implementing the increments from December 2023.
“Detailed eligibility guidelines and process will be shared with your managers soon by HR partners. Revised compensations will be reflected in October payroll along with September arrears,” Govil’s email to employees read.
Technological slowdown
Wipro becomes the second major Indian software company after Tata Consultancy Services Ltd (TCS) to announce a salary hike, easing concerns of a possible delay amid a global technology slowdown.
An email sent to Wipro remained unanswered as of press time.
TCS has granted double-digit salary hikes for top performers and an average of 4.5-7% for the rest, effective April 1, 2024.
India’s $254 billion IT sector grew by a slower pace than ever last year as customers cut spending on technology due to macroeconomic uncertainties.
The average compensation of Wipro employees, excluding whole-time directors, increased by 9.43% in the year ended March 2024, compared to the previous year.
It is true that the increases are not uniform across all teams.
The second official said increases this year could be more than 8% and definitely more than last year.
The expectation
“We are expecting increases of more than 8% this time. While we are not sure of the exact figure, we are confident that it will be higher than what we received last year. However, we will have to wait and watch for the increase letters that will be sent out shortly, which will specify the exact figures of the increase,” the official said.
Although experts do not foresee an immediate change, optimism remains.
“Enterprise customers remain focused on cost optimisation, which continues to drive the bulk of technology spending, but some of the stalled projects have resumed. Prices are expected to remain stable with some upward trend (a positive sign). Corporates are starting to commit to net fresh spending in some sectors,” HDFC Securities analysts said in a note dated September 13.
While Wipro and TCS have announced their salary hike plans, there is still uncertainty at Noida-based HCL Tech and Bengaluru-based Infosys Ltd as neither has decided on the timeline of salary hikes for the year.
“IT services companies are unsure about the macroeconomic situation. They are waiting to get a clearer picture of their growth prospects before deciding on the quantum and timing of hikes,” said Pareekh Jain, CEO and Principal Analyst, EIIRTrend.
Wipro spent ₹549 billion ($6.6 billion) as employee costs for the year ending March 2024, accounting for 61% of the company’s annual revenue of $10.8 billion.
The round of hikes also comes at a time when Wipro is looking to hire staff from campuses after a year-long lull. The company is expected to increase its target of hiring new staff to 10,000 for the year ending March 2025.
Wipro underwent a leadership change just under six months ago when Srinivas Pallia took over as the company’s CEO on April 6, 2024, replacing Frenchman Thierry Delaporte.
“The next few months will be crucial in steering the company towards growth. As a passionate hiker, I deeply relate to these words of Junko Tabei, the first woman to climb Mount Everest. She said, “Although it was difficult, one can reach the summit if one climbs step by step. Of course, I seek the continued trust and support of all of you, our customers, our associates, partners and the media as we move forward,” Pallia said in her first post-earnings interaction as CEO on April 19, 2024.
Disclaimer:
The information contained in this post is for general information purposes only. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the post for any purpose.
We respect the intellectual property rights of content creators. If you are the owner of any material featured on our website and have concerns about its use, please contact us. We are committed to addressing any copyright issues promptly and will remove any material within 2 days of receiving a request from the rightful owner.