Team Siliconindia

·  Labour Ministry summons TCS over 12,000 planned layoffs and delayed onboarding of 600 hires.

·  KITU files industrial dispute, calls layoffs a violation of the Industrial Disputes Act, 1947.

·  TCS cites AI-driven restructuring and slow growth as reasons for its largest-ever workforce cut.

The Labour Ministry has issued a summons to Tata Consultancy Services (TCS) on Friday, August 1, after a complaint was formally made by the Nascent Information Technology Employees Senate (NITES). The summons is at a time when there is increasing criticism regarding large-scale layoffs and delays in the induction of new employees.

TCS is required to clarify two major issues:

- Its decision to sack 2% of its worldwide workforce, affecting about 12,200 employees, and

- The impending onboarding of more than 600 professionals who are stuck in limbo even with job offers.

NITES has criticized the retrenchment as "inhumane, unethical, and outright illegal." Pouring oil to the fire, the Karnataka State IT/ITeS Employees Union (KITU) has registered an industrial dispute against the company charging it with violating sections under the Industrial Disputes Act, 1947, requiring government sanction for mass layoffs.

Also Read- TCS CEO Takes Home Rs 26.5 Crore as 12,000 Employees Face Layoffs

KITU officials met with Additional Labour Commissioner G. Manjunath earlier this week, filing a detailed complaint on behalf of the affected employees. The union has called for criminal proceedings against accountable executives and urgent government intervention.

TCS, the country's largest private-sector employer, had previously announced it would cut 2% of its staff by March 2026 the company's biggest reduction in more than half a century. The cuts will mainly hit mid- and senior-level workers, particularly those with 10+ years of experience.

The company attributed the reductions to slow revenue growth, automation due to AI, and a change in client expectations. TCS, in a public statement, stated that the reduction in jobs is part of an overall endeavor to become "future-ready", including workforce re-alignment, scaled up AI deployment, and investments in next-generation technology and global markets.

"Part of this change will involve releasing associates who are in the organization where their ongoing deployment may not be possible," TCS stated, trying to defend the unpopular move.

The moves have created anxiety throughout India's $245 billion IT industry, raising concerns about job security, workers' rights, and the moral obligations of digital behemoths in a post-pandemic era of digital transformation.