Days after the reports of holding back the salaries of the employees, the IT services giant Cognizant Technology Solutions has made a huge announcement that will provide relief to thousands of employees. The company will give salary raises to 80 percent of its qualified workforce. This will take effect starting November 1, 2025. The action follows the fact that earlier in the year, the company was forced to postpone salary increments due to market conditions.
Who Will Benefit From The Salary Increases?
The pay increases will affect a large share of the Cognizant workforce, namely the employees in the same range up to the Senior Associate ranks. This implies that the main beneficiaries of this compensation adjustment will be junior to mid-level professionals.
The most thrilling part is that the raises are based on the performance of the employees. Star workers in India may receive wage increases in the upper single-digit percentage range, which is indeed a high increment in annual earnings.
The Reward System As Performance-based
Cognizant has adopted its pay policy to increase salaries on a merit basis. In line with their Q2 earnings release, the company affirmed that the best performers will be the greatest beneficiaries as the company offers the largest payouts. This was the plan since the company had pledged to reward most of its employees with merit-based salary increases in the second half of the year.
This reward system based on performance will mean that the employee who is working hard and whose contribution is helping bring success to the company will be rewarded through increased payment.
How Does This Compare To Last Year?
As of 2024, Cognizant was in the same situation. That year, salary increments were delayed but later executed in August. These increments were between 1-5%, which indicates that the current year is more of the same, except that there will be greater chances for high performers to gain more.
The timing of the implemented salary raises and their delay seem to be part of the strategic solution for the company to make both the financials and employee happiness sustainable.
What Are The Other IT Companies Doing?
The mixed reaction to pay raises in the IT sector is evident, and the Cognizant move ranks among the positive ones.
- TCS is conservative in its approach
Tata Consultancy Services (TCS) has also been cautious, with an indefinite postponement of the salary increase. This decision has been attributed by the company to the low demand and the macroeconomic headwinds.
- Infosys gives mixed signals
In April, Infosys provided salary hikes; however, it has yet to disclose the date of the next round of increments. The uncertainty has left their employees waiting in anticipation.
- Wipro is yet to decide
Wipro is presently following a wait-and-see strategy by evaluating the demand conditions and then making an appropriate decision on revising salaries.
Good Financial Performance
The capacity to provide such a pay raise by Cognizant is reinforced by the excellent financial performance. During Q2 2025, the company’s performance in some of the most important metrics was strong.
- Revenue growth
The company registered an 8.1 percent increase in revenue, which stood at $5.25 billion. This number surpassed market expectations and demonstrates the strength of the company even in difficult conditions.
- Profit surge
The net profit increased by 14% compared with the previous year, which shows efficient work and good business plans.
- Raised guidance
Based on good performance, Cognizant also increased its full-year revenue outlook to between $20.7 billion and $21.1 billion. The rate of growth was 4.7-6.7%, which was mainly driven by strategic acquisitions.
Implications For Cognizant Employees
To Cognizant employees who are the current workforce of the company, the announcement has several positive implications:
- Monetary relief: Employees will be relieved by the fact that wages will be raised after a long period of no increase.
- Performance recognition: Good performers will be rewarded highly and commendably for what they contribute.
- Job security: The fact that the company continues hiring bodes well in terms of job security and opportunities to grow.
- Career development: There is a possibility of growth, considering that the company is expanding.
The move by Cognizant to increase the remuneration of 80 percent of its workforce shows that the company is committed to taking care of its employees even as it faces challenges in the industry. Cognizant has the financial strength to support this move, and with a performance-based model of allocating funds, it will succeed in distributing the funds fairly.
Quality business prudence alongside employee satisfaction and maintaining aggressive hiring can set the company in a good position for future growth and employee retention in a competitive market.
Follow Us: Facebook | Instagram | X |
Youtube | Pinterest | Google News |
Entertales is on YouTube; click here to subscribe for the latest videos and updates.