Tata Consultancy Services has reportedly instructed managers to place at least 5% of employees in Band D, the lowest performance rating category, during its latest appraisal cycle, according to a Mint report. The directive comes about a month after the IT services major completed its biggest workforce reduction exercise.
According to an April email from a TCS human resources executive to a business unit head, managers were asked to “review critically and share the list of associates who can be considered for Band D, thereby meeting the agreed 5% distribution.” Business unit heads had reportedly identified about 3% of employees, roughly 17,500 people, as underperformers, creating internal pressure to meet the higher 5% target.
Employees placed in Band D typically face severe consequences. One executive told Mint that many of the employees laid off during the FY26 retrenchment had previously received a Band D rating. Another employee said they had rejected their Band D rating and were looking for a new job before facing a potential salary cut or exit. Employees in the band are usually released from current projects and placed on a two-month internal redeployment cycle.
The performance band directive reflects a wider shift across Indian IT services, with companies accelerating cost optimisation and AI-led delivery models. Analysts have raised concerns that combining a stricter performance review cycle with recent layoffs could affect employee morale and project delivery, even as TCS continues to promote its own AI and digital transformation services to global clients.
TCS has not issued an official public statement on the Band D directive.
