TCS Layoffs 2025: Why India’s Biggest IT Company Is Letting Go of 12,000 Employees

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Tata Consultancy Services (TCS), one of India’s largest IT service providers, has confirmed plans to reduce its workforce by about 12,200 employees, which is roughly 2% of its global team of over 6 lakh people. This is being described as the largest downsizing in the company’s history and will be implemented over the 2026 financial year.

Why Is TCS Cutting Jobs?

  1. Mismatch Between Skills and Roles
    TCS CEO K. Krithivasan clarified that the decision isn’t about AI taking over jobs. Instead, it stems from the challenge of deploying employees with outdated or misaligned skills, making their roles non‑essential for current projects.

  2. A Shift Towards AI‑Driven Work Models
    The company is transitioning from traditional project‑based structures to agile, AI‑supported delivery models, which require leaner teams and a more specialized skill set.

  3. Global Economic Slowdown
    Like many IT firms, TCS is also facing reduced client budgets and slower project ramp‑ups, forcing the company to rethink its workforce structure.

New Bench Policy – Adding Pressure on Employees

TCS has introduced a new rule effective June 12, 2025:

  • Every employee must maintain at least 225 billable days per year.

  • Only 35 non‑billable days are allowed.

  • Those unable to find a suitable project within this timeframe risk losing their roles.

This policy change has sparked concern among employees and industry observers, who fear that it puts heavy pressure on staff to stay deployable at all times.

Support for Affected Staff

Despite the downsizing, TCS says it is committed to easing the impact on those leaving by offering:

  • Notice‑period compensation

  • Severance packages

  • Extended medical coverage

  • Counseling and job placement assistance

Industry Experts Weigh In

Former Tech Mahindra CEO C. P. Gurnani described this move as the end of the old “Sholay‑style” IT approach, where companies focused on building massive workforces. He believes the future lies in output‑oriented, AI‑first strategies that require fewer, but more skilled, employees.

What This Means for Everyone

  • For Employees: The layoffs serve as a reminder that constant upskilling is essential. Legacy roles or outdated skillsets are no longer safe.

  • For the IT Sector: This could set the tone for other big IT companies to rethink their workforce strategies.

  • For Clients & Investors: TCS has assured that these changes won’t affect client deliveries, but the move reflects the larger transformation sweeping the IT industry.

Quick Facts

Detail Information
Jobs Cut Around 12,200 (2% of global workforce)
Who’s Affected Mostly mid‑level and senior employees
Reason Skill mismatch and project deployment issues
New Policy 225 billable days/year, 35‑day bench cap
Support Severance, health benefits, counseling

Final Thoughts

TCS’s restructuring highlights a turning point for India’s IT industry. It’s not just about cost‑cutting—it’s about reshaping the workforce to meet the demands of an AI‑powered future. For employees, it underscores the need to stay agile, continuously learn, and adapt to evolving business needs.

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