The company will shell out up to 125% of the target bonuses — a significant increase from the comparable performance-linked bonus paid at around 95% in the previous year.
Cognizant is also offering performance-based salary hikes to around 160,000 employees globally this year. The quantum of salary hikes was not disclosed. Cognizant also said it has promoted more than 24,000 employees across every level — a number it says is higher than last year’s promotions.
It is also moving to a quarterly promotion cycle for employees at the senior associate level and below from the second quarter of 2021 in a bid to recognise high performers in a more timely manner.
“In recognition of the professionalism, client-centricity, work ethic and perseverance of our employees globally in serving our clients during this protracted pandemic, we are rewarding bonuses above the level of company performance and substantially higher than 2019, despite 2020 being an extraordinarily challenging year,” Cognizant India CMD Rajesh Nambiar said.
“We continue to remain heavily focused on maintaining a competitive and appealing employee environment where every individual is inspired to achieve, driven to perform, and rewarded for their contributions. We aim for our employees to feel motivated, engaged, and empowered to do their best work through careers they find meaningful,” he added.
Cognizant’s higher bonus payouts and promotions follows its voluntary attrition — signifying employees leaving the organisation voluntarily — recorded at 16% for the quarter ended December 2020, compared to 10% in the quarter ended September.
In comparison, attrition for most IT majors was in low double digits for the same period, owing to the pandemic and resulting insecurity in the jobs market. TCS, Infosys, Wipro and HCL reported annualised voluntary attrition rates at 7.6%, 10%, 11% and 10.2% respectively.
In a bid to retain high performers and critical digital talent, Cognizant also recently set up a $30-million retention fund to make them counter offers and prevent them from leaving the company.
Nambiar also told TOI earlier that Cognizant plans to hire more than 23,000 candidates from campus recruitments in 2021 — an increase of around 35% from the number of freshers it hired in 2020.
Industry analysts attributed the human resources churn at Cognizant to a major restructuring exercise that’s been on since its CEO Brian Humphries took over in 2019.
Titled ‘fit for growth’, Humphries’s revival programme focused on going after new-age digital deals, reinventing the delivery model, and also making the organisation more lean and nimble.