Faced with macroeconomic headwinds, the sixth largest IT service company, LTIMindtree rolled out very poor increments for employees. Sources said that while many seniors didn’t get their hikes, juniors saw single-digit appraisal this year.
The development comes days after two IT giants, HCLTech and Wipro said they are postponing their appraisal for employees in this second quarter. Even the second largest IT company, Infosys recently didn’t give a straight answer but said it is actively considering the compensation and hike process for its employees.
“At LTIMindtree, we’ve conducted performance appraisals for our employees at every level, aligned with industry norms. The percentage of salary increments for each employee is determined by their individual performance, length of service with the company, and market competitiveness,” a spokesperson of LTIMindtree said.
Bharat, founder, Bharat Headhunters, said: “With projects getting ramped down, IT companies might not be ready for a situation where they would have large bench at an increased cost of employees. This will further put pressure on their margins.”
In March quarter, LTIMindtree had a total employee headcount of 84,546. This has declined to 82,738 in the June ending quarter.
In another development, the company’s company secretary and compliance officer, Tridib Barat have tendered his resignation. LTIMindtree informed BSE on Wednesday, that Barat intends to pursue opportunities outside L&T group.
In an interaction with FE recently, Debashis Chatterjee, CEO and MD, LTIMindtree, said that the company faced challenges in some of its BFS (Banking and financial services) clients. “They have put a freeze i.e. that they are not on-boarding new resources into those engagements. We expected that these concerns would get over in Q1, but it didn’t get over and continued to Q2 as well.”
The company never gives guidance but it stated last quarter that it expected to grow in double digit. “We had given a double digit growth guidance for FY24, but obviously for the challenges we are facing now, it’s probably very difficult to get to that level.”, added Chatterjee.