Tata Consultancy Services [Get Quote] has raised the performance bar for its 143,000 odd employees. Those under the scanner will now be given only three months to improve their skills.

The company, India's largest for information technology services, will no longer give an extension.

"We have reduced the time period for improving skills. Earlier, if an employee would show even a small improvement, we would give an extension of a few more months. Henceforth, that will not be done," said Ajoy Mukherjee, vice-president and head, global human resources.

The company will consider an employee's performance for the past three years so as to maintain consistency.

Mukherjee dismissed allegations that the company had put over 1,000 employees under the scanner in India.

"Globally, we had around 1,100 employees under our performance improvement programme. Of this, the India number was 700-725, which is not even 1 per cent of the TCS headcount. The reason for this number to be more than the usual 500 is because our employee base has also increased," said Mukherjee.

The company added close to 22,000 trainees in fiscal year 2009. Despite this, it managed to reduce its employee cost by Rs 121 crore (Rs 1.21 billion).

Mukherjee believes some measures the company has put in place in the first quarter of FY09 have begun yielding results. These include changing the mix of trainees to lateral (experienced hands).

From the third quarter, it hired laterals in a controlled manner. By the end of the year, TCS' mix of trainees to lateral was 72:28.

Further, the offshoring focus reduced employee cost. Over 1,000 employees of the company onsite have returned, as a result of which the allowance cost has come down.

While Mukherjee did not give any details on variable pay for fiscal year 2010, he said the  status quo would be maintained.