TCS adjusts pricing for staffing firms to enhance transparency; first revision in 6 years

TCS to revise rates for staffing cos: Days after India’s largest IT services company TCS fired 16 employees and barred six vendors in connection with a “recruitment scam”, there's been a report that TCS is revising the rates it pays to approximately 1,000 staffing firms for every engineer deployed.

This marks the first rate revision in the past six years. The new pricing structure for engineers, based on their skill sets, is expected to take effect from January.

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Typically, vendor contracts with staffing firms are renewed in September or October and remain valid for a year. However, TCS has informed these staffing firms that the existing contracts will continue until December of this year, and new contracts with the revised rates will come into effect in January.

TCS Revamps Rate Card

TCS's rate card includes various costs associated with candidate placement, such as compensation, vendor costs, and insurance, among other expenses. The introduction of a new pricing structure is aimed at enhancing transparency in the company's dealings with staffing firms.

This move is likely part of TCS's efforts to manage costs, ensure competitive rates, and adapt to changes in the IT industry. It could also reflect the evolving skill requirements in the technology sector, with different skill sets commanding different rates.

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TCS Recruitment scam

This revision in rates comes after the bribes-for-jobs scam. TCS on Oct 15th said it has fired 16 employees and barred six vendors in connection with the issue.

“Our investigation found 19 employees to be involved…16 employees have been separated from the company for code of conduct violations, and three employees have been removed from the resource management function,” the company said in a late evening statement.

It also added that six vendors, their owners and affiliates have been “debarred” from doing any business with TCS.

In late June, reports had surfaced of a recruitment scam, wherein vendors tasked with some functions were alleged to have indulged in malpractices in collusion with TCS staffers.