Employees in the Thiruvananthapuram office of edtech unicorn Byju’s have alleged that after being pressured to resign for more than a week, the company management has now offered them a transfer option, only because the issue attracted media attention. On Tuesday, October 25, some of the employees had met state Labour Minister V Sivankutty to seek compensation, following which the company management, which had not issued any official communication to the employees until then, suddenly offered them a transfer option.
TNM spoke to three employees of the Byju’s Thiruvananthapuram office, who said that from around two weeks ago there had been strong speculation that the office would shut down soon. “Sometime back, a rumour spread that the office was closing down. Later, the human resource officer confirmed this verbally and started pressuring employees to resign. They called each of us for an exit meeting individually last Friday and demanded our resignation. They also threatened to fire us if we did not resign,” one of the employees told TNM.
The employees who were asked to resign belong to the media and content creation sections of the company. “We were all employed in prestigious companies earlier. We were offered jobs here for higher salaries. Most of us have work experience of more than 10 years,” said another employee. Fearing that they won’t get their exit papers if they were terminated, around 70 of the 170 employees at the office put in their papers on the subsequent days. It was at this point that some of the employees contacted Prathidwani, a welfare organisation for Technopark employees, and met the minister on October 25. The Labour Ministry, after speaking to the employees, soon called for a negotiation meeting presided over by Sivankutty on October 31.
Hours after the meeting with the minister, on the night of October 25, Byju’s company management which had so far stonewalled the employees sent a ‘reconciliatory’ email to them, saying the office has made provisions to accommodate the entire Thiruvananthapuram team in their Bengaluru operations. In the email titled ‘Relocation Opportunity for Team TVM & Other Benefits’, Byju’s Chief Content Officer Vinay Ravindra said that while the Thiruvananthapuram centre will be shut down as part of the firm’s efforts to “realign its resources”, the employees’ jobs were still secure. “All you need to do is join the Bengaluru team by December 1 to resume your current roles,” said the email, a copy of which TNM has received access to.
Vinay, in the mail, goes on to state that in case the employees choose not to avail this opportunity, they will still get a ‘progressive exit package’. “This package includes a six month extension of health insurance for you and your family, fast tracked full and final settlement, provision of garden leave where you remain on the payroll as you look for your next job and out placement services where we make the industry’s best placement consultants available to you,” the mail further said.
However, employees are not convinced. They believe that the management’s transfer offer is a tactic to lay them off later without any trouble. “With their intolerable pressure, around 70 employees have already put in their papers. We know that many employees were sacked (resignation sought forcefully) from the Bengaluru office. They are offering us this transfer option only because the issue was made public. Once in Bengaluru, they can easily sack us,” said an employee. Others agreed with this, saying, “They laid off many employees from different offices in other states without any issue. That is why they are calling us to Bengaluru. They cannot accommodate these many employees there. The mental torture demanding our resignation has been going on for a long time. Why didn’t they offer us the transfer option then?”
A report by The Morning Context confirms their fears. It stated that Byju’s IBC Knowledge Park office in southern Bengaluru is also shutting down. In fact, the crisis is far worse in Bengaluru, with managers unable to answer the workers’ questions on why their jobs were lost. “Once, the company had occupied five floors across two towers in the [Bengaluru] business district, which housed close to 4,000 employees. The news is that Reliance Trends is taking the space,” the report said.
Byju’s started its office out of Technopark in Thiruvananthapuram in 2019. The closing down of the Thiruvananthapuram office and the layoff of employees comes on the heels of crippling financial losses that the company suffered in the last financial year. In the second week of October, Byju’s had announced that it would lay off 5% of its 50,000 employees in a phased manner, in an attempt to rationalise the workforce. However, according to the report by TheMorningContext, people in the know have revealed that the company was planning to lay off 12,000 employees across departments, nearly 25% of its workforce, in the current financial year.
The Thiruvananthapuram employees have put forth many demands. These include payment of the salary for October 2022 on November 1, 2022, one-time settlement of salary for the upcoming three months, from November 2022 to January 2023, as well as earned leave encashment and full settlement of variable pay (as applicable to each employee) from the management.
Once considered India’s most valuable startup, Byju’s is currently valued at $22 billion. Its losses were marked at Rs 4,588 crore in FY 21. This was almost 20 times more than its loss of Rs 232 crore in FY 20. Its auditing firm Deloitte raised multiple concerns on the company’s accounts, causing the filing of the audited results to be delayed by 18 months. When the audit results were published in September 2022, there emerged discrepancies between the unaudited revenue projected by the company and the official numbers signed off after the audit. The projected revenue was Rs 4,400 crore and the audited revenue was Rs 2,280 crore, marking a 48% drop. CEO Byju Raveendran claimed that this was because the company changed its revenue recognition model after 2020. The company further claimed that the revenue in FY 22 increased to Rs 10,000 crore, which is fourfold of the previous year’s, without disclosing the profit and loss accounts of the year.
Lok Sabha MP Karti Chidambaram recently wrote to the Institute of Chartered Accountants of India (ICAI) flagging several concerns in the company’s accounts. He asked the ICAI to probe the financial accounts of Byju’s as the company offers no clear picture of its income, expenses and losses. One of the concerns raised by the MP was that 60% of employee-related costs were categorised as capital expenses and not operational costs. Had these been accounted as operational costs, Byju’s losses in FY 21 would have crossed Rs 5,000 crore.
It is learned that a negotiation meeting between the management and the staff, presided over by the Labour Minister, will happen on October 31.