Accenture, a US-based IT giant that last month announced first-quarter earnings that fell short of expectations, said it will not be giving raises to its staff in India and Sri Lanka this year, with the exception of a few key skill areas and instances where it is required by law.
Ajay Vij, the country’s managing director, stated that the company’s growth was less than expected at the start of FY23 and that the macro environment was more difficult than anticipated in an internal email to staff that Fe gained access to. According to him, the company had to make some difficult choices about awards and promotions as a result.
Accenture has a financial year that runs from September to August, and their FY24 projection was the second-lowest among those given at the start of the year over the previous 16 years. It has predicted revenue growth of between -2% and 2% in the first quarter of FY24 and anticipates overall revenue growth to be between 2% and 5%.
“Our rewards philosophy is to offer Accenture with market-relevant pay based on talents and location. The viability of our business, including competitive pricing of our services, depends on keeping our wages in line with the market, Vij wrote in the email.
While individual performance incentives will be paid out based on each employee’s contributions wherever they are relevant, the email also noted that they will be “significantly lower than last year.”
“…our company’s performance determines how much of our yearly global bonus is funded. Our global yearly bonuses would likely be much lower than the previous year given our results, he said.
Additionally, the corporation is drastically lowering its promotions. The corporation stated that it will award promotions in December as expected up to the rank of associate director (rank 5), but they will be less than in 2017. There are 13 levels in Accenture, with 1 being the highest and 13 being the lowest. Levels 1 through 4 promotions will not take place until June 2024.
According to Vij’s email, “We are delaying our promotions to and within MD, as well as appointments to SMD, until June 2024 in order to give ourselves the opportunity to return to growth so that promotions are feasible.”
“Our compensation policy is to offer market-relevant compensation based on the capabilities and areas where we operate. When deciding on compensation and benefits, we also take a number of other aspects into account, such as the macroeconomic situation, a spokeswoman for Accenture stated.
Several domestic IT companies made comparable choices prior to Accenture.HCLTech announced it would delay the pay increases for junior employees by a quarter and forego the pay increases for top management-level professionals in the April–June quarter.
Also delayed from September to December 2023 are Wipro’s compensation increases and Infosys has not yet implemented salary increases that were originally scheduled for April and July.
