This IT company announces big bonuses to retain employees as attrition surges

IT services giant Cognizant Technology Solutions said it will roll out higher bonuses to retain employees amid a war for talent across the tech industry.  The company reported industry’s highest attrition rate among its peers at 33%. 

In an analysts call, Cognizant CEO Brian Humphries said the company will give out higher bonuses and will also implement targeted merit increases and promotions in the fourth quarter.

Cognizant, which has more than two-thirds of its overall employees in India, reported an 11% year-on-year rise in revenue in constant currency to $4.7 billion for the third quarter ended September as business momentum, especially in digital services, continued to improve.

On a trailing 12-month basis, the attrition rate of Tata Consultancy Services Ltd (TCS) was lowest among its peers at 11.9% in the September quarter. During the same period, the attrition rate of Infosys Ltd stood at 20.1% while that of Wipro Ltd stood at 20.5%, and HCL Technologies Ltd, at 15.7%.

“Retention and recruitment have our leadership’s full attention. We are continuing our comprehensive program to support our associates’ career growth and engagement through a range of initiatives that include committed annual increases, an evolved approach to promotions, job boards so associates can easily explore open leadership roles companywide, abundant new training and development programs, sustained communication with our commitment to belonging and inclusion across our company and to society more broadly, and the continuing pursuit of an ESG agenda which holds special meaning for our associates,” Humphries said.

The company’s chief financial officer Jan Siegmund said the IT firm will continue to invest significantly in the people through increased compensation, growing quarterly promotions for billable associates and training.

“As a reminder, the annual merit increase for the majority of our associates is effective October 1,” Siegmund said.

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