Wipro Considers Skipping Salary Hikes For Top Performers Amid Industry Challenges
Wipro is reportedly mulling over a decision to withhold salary hikes for its top performers with higher compensation in its largest business segment, Wipro Enterprise Futuring. An internal memo seen by Reuters revealed that this move comes as the company grapples with a host of challenges, including reduced client spending and intense competition from larger industry rivals.
In the internal communication, Nagendra Bandaru, Managing Partner and President of the "Enterprise Futuring" business line, stated that the company is planning a selective rollout of merit salary increases (MSI) based on its current business affordability. In this strategy, employees with lower compensation will be given priority for raises, while "top performers with higher compensation may not be covered in this cycle."
Wipro Enterprise Futuring, established as part of an organisational overhaul in April, primarily focuses on large-scale digital and technology transformations for client companies. The broader Indian information technology industry, valued at USD 245 billion, has been facing challenges in recent quarters. These difficulties stem from clients cutting back on spending for discretionary projects due to inflationary pressures and global economic uncertainties.
The move to potentially skip salary hikes for top performers with higher compensation could impact employee morale and potentially lead to increased attrition within the company.
Wipro had already delayed its salary hike cycle and this latest decision further underscores the challenging environment that IT companies in India are navigating.
This decision by Wipro aligns with a broader trend in the technology industry as companies seek to address pay inequities among regions and reduce payroll costs. Wipro's competitors have also explored various strategies to manage payroll costs. For instance, Infosys delayed salary hikes by two quarters, and HCL skipped hikes for managers. The IT sector continues to adapt to changing market conditions and financial constraints, impacting employees and companies alike.
