Accenture Introduces New Salary Hike Model, Splits Pay Raise Between Base Salary and Cash Payout

Accenture introduces new pay model: Half in salary, half as cash

Under the new approach, 50% of an approved salary increase will be added to an employee’s base salary. The remaining 50% will be paid separately as a one-time lump-sum amount.

Accenture has changed the way it gives salary hikes to employees. Under the new system, workers WHO receive an approved pay rise will get half of the increase added to their basic salary, while the other half will be paid as a one-time cash payout in June.

The revised compensation structure will be introduced as part of the company’s June salary review and will apply to its global workforce, including around 3.5 lakh employees in India.

HOW THE NEW SALARY HIKE MODEL WILL WORK

Under the new approach, 50% of an approved salary increase will be added to an employee’s base salary. The remaining 50% will be paid separately as a one-time lump-sum amount.

For example, if an employee is approved for a 3% Salary Hike, 1.5% will be added to the base salary, while the remaining 1.5% will be paid as a one-time cash payment in June.

According to an internal memo cited by PTI, the company said the new model is designed to give employees more cash immediately while allowing it to extend base salary increases to a larger number of employees.

The company said it had given only limited salary increases to employees who remained at the same level last year. This year, however, it has increased the number of employees eligible for base pay hikes by dividing the approved increment between permanent salary and a one-time payout.

Accenture has said that salary increases linked to promotions will continue to be added fully to employees’ base pay. The one-time cash payment will also remain separate from the company’s annual bonus cycle, which takes place in December.

The company added that compensation decisions will continue to depend on employees’ skills, performance, impact and behaviour.

Meanwhile, the revised pay structure has received mixed reactions from employees. Some have raised questions about whether the new arrangement is only for this year, while others have sought clarity on how the one-time payout will be taxed.