TCS variable pay Q2: C3A and above get nothing, juniors get 100%. What it means for you

If you work at TCS, today's question is simple: am I getting my variable pay this quarter? The answer depends on your grade.

What the memo says

According to an internal memo seen by Reuters, signed by chief human resources officer Sudeep Kunnumal:

"For associates C3A grade and above, there will be no QVA (quarterly variable allowance) this quarter. This decision was taken after careful consideration as our performance for the quarter fell short of internal targets."

The memo also says junior-level employees will get 100% of their eligible pay. TCS didn't respond to Reuters' queries, and hasn't commented publicly on the memo.

Which grade are you?

These experience bands come from Reuters. Your own grade is in your HR records. We don't list exact grade names below C3A, because the reports don't spell them out.

What "eligible" means: the memo says juniors get 100% of their eligible pay. The reports don't explain how your eligible amount is worked out, so check your payslip rather than assuming you'll get your full target.

Why it happened

The memo blames performance against internal targets. On the Q2 FY27 earnings call, CFO Samir Seksaria said: "given our performance against internal targets, we have had a lower outlay of performance-linked bonus this time" (Moneycontrol). He also said operating margins will take a 50-basis-point hit once the $373 million acquisition of Porsche's IT arm MHP closes.

The results themselves were mixed:

• Net profit rose 15% year on year to ₹13,884 crore (PTI via Mint).
• In dollars, revenue rose 0.2% quarter on quarter and 2.4% year on year, to $7,642 million (TCS). Reuters called it the weakest September-quarter sequential growth in three years.
• AI revenue reached an annualised $3.1 billion, more than 10% of revenue (TCS). Shares rose as much as 6.2% on Friday.

Is this unusual?

Yes, by TCS's recent standards. Employees told Reuters the company usually pays 50–100% of variable pay, and this is the first time in at least two years it has said explicitly that some grades get nothing. In August, Moneycontrol reported that mid-level and senior staff got an average of 60–70% for Q1, down from up to 80% in the two quarters before.

What you can do

• Check your payslip when the QVA is paid out, and confirm your grade in your HR system.
• If you're a junior and get less than you expected, ask HR how your "eligible" amount was worked out.
• If you're C3A or above, this is a quarterly decision. Reports don't say anything about Q3 yet, so treat anything you read about future quarters as speculation until TCS says otherwise.

Also on KyunTrend: EPF wage ceiling to ₹25,000: what changes on your payslip.

Timeline

1. Aug 2026

   Moneycontrol reports that TCS paid mid/senior staff an average of 60–70% variable pay for Q1.

2. 8 Oct 2026

   Q2 FY27 earnings call: the CFO says there was a 'lower outlay of performance-linked bonus' (Moneycontrol).

3. 9 Oct 2026

   Shares rise as much as 6.2% on AI revenue growth (Reuters).

4. 10 Oct 2026

   Reuters reports an internal memo: no QVA for C3A and above; juniors get 100%.