TCS told 12,000 employees to go — then the unions came for it

In July 2025, Tata Consultancy Services — India's largest IT employer with 585,000 employees — announced it would cut 2% of its workforce, roughly 12,000 middle- and senior-level roles, over three quarters of FY2026. CEO K Krithivasan cited a 'skill mismatch' as the reason: the company needed fewer managers and more AI-ready engineers. The industry had never seen India's biggest private-sector employer resort to formal layoffs.

But the cuts were not communicated as layoffs. Instead, TCS pressured employees in Pune, Bengaluru, and other centres to resign — what unions called 'forced resignations.' The company implemented a 35-day bench policy: employees without billable projects had just over a month to find one or leave. Social media posts described intense HR pressure, humiliation, and hopelessness. By one account, TCS asked roughly 2,500 employees in Pune alone to resign.

The backlash came from every direction. IT employee unions NITES, KITU, and UNITE called the retrenchment illegal under the Industrial Disputes Act and demanded government intervention. The Pune Labour Commissioner summoned TCS for a hearing in November 2025. The Karnataka labour department reviewed evidence but said the documents did not show mass layoffs — the very ambiguity that let TCS avoid formal retrenchment procedures. Meanwhile, US Senators questioned TCS over H-1B visa filings after American staff were affected.

By FY2026 end, TCS headcount had fallen by roughly 23,000 — nearly double the announced 12,000 target — through a mix of layoffs, natural attrition frozen by the policy shift, and the chilling effect on new hires. Krithivasan's ₹26.52 crore salary became a public flashpoint. The company would later say 'no more layoffs for now' and announce aggressive fresher hiring, but the episode had already made TCS the face of India's IT industry transition from labour-scale to AI-driven operations.