Global IT services giant Cognizant will implement salary increases for ‘eligible’ employees from August 1, a four-month delay from the previous cycle of April 2023, according to a report by Money control.
“We strive to recognize the hard work and dedication of our employees through annual merit increases and bonuses. As part of this commitment, the merit increase for eligible employees will be awarded on August 1 this year. Importantly, the majority of our employees have seen four earnings increases within three years, with the last cycle being April 1, 2023,” Cognizant said. in an official statement.
The statement also noted that the Nasdaq-listed company recently awarded annual bonuses to “eligible associates worldwide.”
“This continuity underlines our commitment to consistently recognizing the contributions of our talented employees,” the press release said.
Since 2021, a majority of Cognizant employees have received three raises, which were given in October 2021, October 2022, and April 2023. So the latest raise will be their fourth since then.
Why is Cognizant postponing salary increases?
In February, Cognizant implemented a new policy requiring employees in India to work in the office three times a week. Headquartered in Teaneck, the company has more than 347,700 employees worldwide, including approximately 254,000 in India.
The delay in rate hikes comes at a challenging time for software services exporters and technology companies. They are currently facing weak demand as customers tighten their budgets due to the uncertain and tense macroeconomic situation.
In the fourth quarter of FY23 ending in December, Cognizant saw a 1.7 percent year-over-year revenue decline to $4.76 billion. This is likely an eight-quarter low, mainly due to continued demand weakness.
However, Cognizant’s profit rose 7 percent year-over-year to $558 million.
For the full year 2023, Cognizant reported a 0.4 percent year-over-year revenue decline to $19.4 billion. In constant currency terms the decline was 0.3 percent.
Cognizant expects first quarter revenue for FY24 to be between $4.68 billion and $4.76 billion, reflecting a decline of 2.7 percent to 1.2 percent, or a decline of 3.0 percent to 1 .5 percent at constant exchange rates.
First print: April 6, 2024 | 1:20 PM IST