The number of employees at large IT companies with pay packets of Rs 1 crore ($150,000) or more shrank sharply but those in the middle rung stayed put, reflecting a churn at the top ranks in the year ended March 31, 2016.
The number of Rs 1 crore plus earners at Infosys and Wipro almost halved (see chart) as several of those with big pay packets quit the firms. To be sure, the big picture also has to do with a change in remuneration methodology. So, for Wipro there was a change with respect to inclusion of restricted stock units (RSU), according to the company spokesperson.
At Infosys, the decline was partly due to payout of long-term bonus for previous years during 2014-15 that led to a temporary inflation of salaries during that year.
Under the earlier policy, the company rewarded executives above the associate vice-president level with long-term bonuses that had accumulated over a period of three years, after these executives completed at least one year in that role, it’s spokesperson told VCCircle. As a result, there was a big spike in the number of Rs 1 crore-plus earners against the year ended March 31, 2014.
But, at the same time several high earners also quit the firm and that also pushed the total number of Rs 1 crore-plus pay packets down. For instance, Infosys saw around 20 of its Rs 1 crore plus pay packet employees (of FY15) quit last year.
On the flip side, the number of employees enjoying a pay package of Rs 60 lakh per annum or more at both Wipro and Infosys rose. This means compensation at the middle management level remained robust.
The comparable data for TCS are not available in the public domain, but it has traditionally been a conservative pay master and is unlikely to have deviated from the industry trend.
Top execs get hefty hikes
Meanwhile, top bosses had a great year. Vishal Sikka, who took over as the new chief executive of IT services major Infosys in August 2014, took home a whopping Rs 48.73 crore in the fiscal gone by, the highest by any senior executive at the company or among three top IT companies, against Rs 4.56 crore in the previous year. His pay packet was 935 times that of an average (median) employee of the firm.
As per the annual report, the fixed salary of Sikka in the fiscal 2015-16 was Rs 6.29 crore. He received Rs 42 crore as variable pay, which took his entire pay package for the year to Rs 48.73 crore. One-third of this variable pay was for his services in the previous year ended March 31, 2015.
While the second highest paid Infoscian Rajiv Bansal quit as chief financial officer last October, U B Pravin Rao, COO of the firm, did not do too bad either. He got over 52% pay hike last year.
N Chandrasekaran, chief executive officer and managing director of the country’s largest software exporter TCS, took home around Rs 25.66 crore in the year, up 20.5% compared with 2014-15. The previous year he had received a 13.9% hike.
His pay packet was 460 times the median remuneration of TCS employees.
In the meantime, in his first year at Wipro, Abidali Neemuchwala, who was appointed as chief executive of the company in February this year, took home an annual pay package of Rs 11.96 crore. Neemuchwala, former global BPO chief of TCS, had joined Wipro as president and COO in April 2015.
The ratio of his remuneration to the average for a Wipro employee at 228 was the lowest among his industry peers.
TK Kurien, former CEO who is currently serving as executive vice chairman at Wipro, received an annual pay package of Rs 13.66 crore against Rs 9.11 crore in 2014-15. Sangita Singh, who quit the firm last year, also entered the highest paid club. She was the highest paid female executive in the IT industry.
On the flip side, billionaire Azim H Premji, chairman and managing director, took a pay cut to Rs 2.17 crore from Rs 4.78 crore in the previous year. His son Rishad, who joined the Wipro board in May 2015 and doubles up as an executive director and chief strategy officer took home Rs 2.15 crore.
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