Accenture Changes Salary Hike Structure: Half Now Paid as One-Time Cash

Accenture, the global IT services company, has announced a change in how it gives annual salary increases to employees. Instead of adding the entire raise to an employee's fixed salary, the company will now split the increase: half will be added to the base pay, and the other half will be paid as a one-time lump sum during the June compensation cycle.

For example, if an employee receives a 4 per cent raise, only 2 per cent will become part of the monthly salary. The remaining 2 per cent will be paid separately as a cash payout. The new structure was communicated through an internal memo reviewed by multiple media organisations.

According to Accenture, the revised approach allows the company to recognise a larger number of employees without significantly increasing fixed salary costs. The company said that many employees value immediate cash payments, and splitting the increment helps balance rewarding staff with managing costs in a difficult business environment.

During the previous compensation cycle, Accenture offered only limited salary increases to employees who stayed in the same role. This year, the company is widening the pool of employees eligible for hikes by adopting the new payout structure.

Promotions are not affected by this change. Employees moving to a higher role will continue to receive the entire salary increase as part of their base pay. The company has also clarified that the one-time lump-sum payment is separate from the annual performance bonus, which is paid during the December compensation cycle.

Abhishek Bhilwaria, Partner at BhilwariaFinserv, commented: "This approach allows companies to recognise and reward a broader segment of their workforce today while simultaneously managing long-term fixed payroll compounding and operational risk."

For employees, the new model means a larger amount of cash immediately. However, because only half of the increase becomes part of the fixed salary, the long-term impact on future increments and retirement-linked benefits may be lower than under the earlier system. The policy has sparked discussion among employees, with some welcoming the immediate payout while others question its effect on future salary growth and taxation.

Accenture employs more than 7.8 lakh people globally, including around 3.5 lakh in India, making this one of the biggest compensation policy revisions in the IT services sector this year.