HCL Technologies, which has realigned its financial year, is likely to shift its appraisal cycle too in line with the rest of the industry which gives out pay hikes from April onwards.
The change, however, will come only from next year. HCL, which announced its financial results last week has altered its financial year from earlier July to June to April to March now in order to comply with the new Companies Act.
When asked whether the company will shift to an April to March appraisal cycle from next year onwards, Anant Gupta, CEO of HCL Technologies said: "Ideally yes, that's what we should be doing." Talking to ET, Gupta said that, however, appraisal cycle in the current year will maintain status quo.
"This year it will happen in July because it is just too much to shift the entire organisational planning." He added that from a compliance perspective, the company closed its financial year 2015-16 in nine months, and has taken one more quarter from the previous financial year for all comparison purposes.
"I think from a books perspective it (fiscal year) has moved, and this cycle the wage hikes etc will come in when we get into the next quarter announcements," he said. HCL has been doling out wage hikes in phases.
"The effective date for high performers is July 1, and the people who are at the bottom of the performance pack get it a quarter later which is October," he said.
Shergill added that the company is still in the process of completing its compensation analysis and survey and hasn't arrived at a figure for hikes yet. TCS announced in April that salaries of its employees in India would rise between 8% and 12% in fiscal 2017, which is marginally higher than the raise offered by its rival Infosys.
Infosys said earlier that it would hike wages by 6-12% for employees in the country. Even TCS employees in other regions will fare better salary-wise, with TCS saying it was offering a hike of 2-6%, compared to the 1.5-2% wage increase announced by Infosys. TCS has been grappling with higher attrition for three quarters and has said it is looking at ways to bring it down.
Infosys has also said that its top performers would be rewarded with much higher pay hikes than the average range and about 20-25% of managerial level staff would also be rewarded with stocks.
TCS also said it would pay out 100% of its employees' variable pay. Asked whether the compensation will be in line with what has been doled out at HCL's peers, Shergill said: "They have done what we have been doing for some time now, which is differentiation for high performers. It is interesting to see headlines around that because that's the right approach for progressive organisations."
For the three months ended March 31, 2016, HCL Tech reported a 5.5% jump in net profit at $285 million which came on back of a 6.5% increase in revenues at $1.6 billion compared to the same period last year. On a sequential basis, net profit dropped 2% and revenue was up 1.3%.