In 2025, Tata Consultancy Services (TCS) announced a major restructuring in the company. Reportedly forced by the increasing use of AI, this restructuring led to job cuts within the company. Now, TCS has confirmed that the job cuts linked to its ongoing restructuring plan are not over yet. They will continue in 2026 also.

After announcing its Q3 results, TCS has said that employee attrition will continue in the next quarter as well, although it has no specific target in mind. The company says each termination will be supported by a valid reason and handled through a defined internal process, even as it continues to reduce its overall workforce. The statement comes at a time when many TCS employees may be worried due to declining headcount, strict office attendance rules and delays in assessment.

TCS says there will be no number based layoffs

According to Moneycontrol, TCS Chief Human Resources Officer Sudeep Kunnumal has told analysts that the company laid off about 1,800 employees during the October-December quarter. This number appears to be much lower than the number shown by the TCS fact sheet on its quarterly results. TCS’ total headcount declined by a little more than 11,000 compared to its total headcount at the end of the second quarter, according to the fact sheet.

This indicates that the layoffs at TCS in the last three months could be a mix of natural dismissals, where the employees left of their own free will, along with the company deliberately laying off 1,800 employees using due process. And once an employee left, TCS did not make any recruitment to fill the vacancy.

Kunnumal said layoffs could extend into the next quarter, but he emphasized that the company is not chasing any specific count. According to him, coming out happens only when there is a clear and genuine reason.

The number of employees keeps falling

TCS cut its workforce by 11,151 employees in the October to December quarter. As a result, its total employee strength declined to 5,82,163 at the end of December from 5,93,314 in the previous quarter. This is the second consecutive quarter in which the company has recorded a net decline in the number of employees, taking its workforce well below the six lakh mark. Overall, the company has cut about 30,000 employees over the past six months, if you also take into account the 19,755 employee cuts in the September quarter.

While there has been a fair assumption that TCS, like many other tech companies these days, is reducing headcount to meet the challenges – and opportunities – brought by the cloud and AI tools like Cursor, there could be another side to it. A recent report from Oxford Economics highlights that most of the job cuts seen in recent months are not actually due to AI. Instead, they are an attempt by companies to optimize their workforce while weeding out non-performers. Efforts are also made to reduce costs. But to control the message of job losses among employees as well as the public, companies are citing AI impact as a reason behind job losses.

Having said that, it should be noted that there is no indication that TCS is doing what Oxford Economics has highlighted in its report.

Office attendance rules raise employee concerns

Like other tech companies, TCS is also changing workplace rules. Recently, the company has tightened its requirements for working from the office. Reports suggest that some employees have withheld their final anniversary assessments because they failed to meet the mandatory office attendance requirements. In some cases, evaluation was completed at the team level but not approved at the central level. The internal communication reviewed by the media warned that employees could also miss the 2026 performance rating cycle due to continued non-compliance with office attendance.