Cognizant offers annual salary hike as low as 1% to employees: Report

Amid criticism for offering its lowest salary packages to freshers in a decade, Cognizant Technology Solutions has reportedly given some employees annual salary hikes as small as 1%. This comes as the global technology services company rolled out salary hikes after a four-month delay, according to a report by The Economic Times.

The salary hike ranges from as low as 1% to as high as 5%, sources were quoted as saying by ET.

“For a rating of 3, the hike is around 1-3% while a 4 rating has been granted a 4% hike and a 5 rating to an employee is paid an increment of around 4.5% and at the most 5%,” source said.

Last year, the Nasdaq-listed company gave its employees salary increases in April, with the hikes ranging from about 7 per cent to 11 per cent.

The introduction of these modest salary increases comes amid widespread criticism of Cognizant for offering its lowest starting salaries in a decade— ₹2.52 lakh per year, or roughly ₹21,000 per month—to new hires through its off-campus recruitment drive starting Wednesday.

The company, based in New Jersey, employs approximately 254,000 people in India, which accounts for about 70 per cent of its overall workforce.

In the quarter ending in June, the company saw a decrease in its total workforce by 8,100, bringing the number of employees down to 336,300. This represents a decline of 9,300 employees compared to the same period last year.

Although Cognizant is one of India’s major outsourcing firms with a global presence, industry experts indicate that the company has reduced its latest salary package to levels reminiscent of 2002. This decision has sparked strong criticism, particularly given the current subdued economic environment.

The company reported a reduction in its total workforce by 8,100, bringing the headcount to 336,300 during the quarter ending in June. This represents a decrease of 9,300 employees compared to the same period last year.

Despite being one of India’s leading outsourcing firms with a global footprint, industry experts note that Cognizant has reverted to salary packages reminiscent of 2002 levels. This decision has sparked significant criticism, particularly given the subdued economic environment.

In its second quarter ending in June, Cognizant reported a 22.2% year-on-year (YoY) increase and a 3.6% sequential rise in net profit, totaling $566 million. Revenue for the quarter stood at $4.85 billion, reflecting a slight decline of 0.7% compared to the previous year.