Indiabulls Group has reportedly asked over 2000 employees to resign via WhatsApp calls, leaving no trace of official communication.

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Money Layoffs Saturday, May 23, 2020 - 12:16

COVID-19 has hit all companies across industries with most seeing meager or zero inflow of revenue. From India’s largest business conglomerate Reliance Industries to smaller startups, there have been pay cuts and layoffs across the board. Several companies, especially startups have had to let go employees, thousands in some cases.

However, while many of them have been offering good severance packages and support to the laid off staff, there are also some companies that are forcing employees to resign, with no official communication, thus leaving no record of an official layoff.

There has been uproar on Twitter and other social media platforms from employees of financial services group Indiabulls Group, which has reportedly asked over 2000 employees to resign.

According to employees TNM spoke to, they were informed by their managers over a WhatsApp call that the company is undergoing restructuring as a result of which their role will no longer be required in the company. Most employees were informed in the second week of May and were given a few days to resign through the company’s portal.

“I got a call on May 15 and I was told to resign within two days and that May 31 will be my last working day. It was not even a call from the HR; my manager called me on WhatsApp. He said there won’t be any compensation and that my full and final settlement will come by May 31. This is after they gave me a pay cut earlier; and when I refused to accept it, my March and April salary was withheld. I received my salary only two days ago and that too with a 50% pay cut,” an employee alleged.

Some employees have also alleged that they were intimidated saying that if they don’t resign, they will be terminated and will receive neither their full and final settlement nor experience letter. In many cases, their access to official mail and all forms of official communication was allegedly blocked.

Employees across Indiabulls’ group companies including Indiabulls Housing Finance, Indiabulls Securities, Indiabulls Ventures, have claimed similar treatment.  

In some cases, employees say they were given transfer letters, reassigned to places far away from their current working location and in different roles. One employee, who was working as a software engineer in north India was transferred to Mangaluru in Karnataka as a collection officer.

According to transfer letters shared by employees with TNM, they were told that the company was “reorganising its business and consolidating branches with a view to primarily focus on small home loans and collections” as a result of which the employee will be transferred with effect from May 25, 2020.

“When I didn’t accept the resignation, they transferred me from Noida to a small town in Andhra Pradesh. The reporting date there is May 25, which is impossible as transport facilities are not available during lockdown,” one employee said.

An Indabulls spokeserpson told TNM that the Indiabulls Group employs more than 26,000 people. “In FY19-20 itself, we added over 7000 new members.” The company typically sees an attrition of 10%-15% of its workforce every year during April-May in the normal course of business. “This year we waited till we got clarity from the Supreme Court and the Ministry of Home Affairs. There are no layoffs other than in the normal course of business due to attrition and as per the performance trend of the entire year and not just a couple of months,” the company spokesperson added.

Indiabulls isn’t the only company that employees have alleged of such practices. Earlier in May, there were reports of Cure.fit also laying off scores of employees across functions as it moved to a digital model. In this case as well, employees alleged that they were forced to send in their resignation.

Extramarks Education

Employees of Noida-based edutech company Extramarks Education have also alleged that the company was asking them to resign. Many took to LinkedIn and Twitter to express their discontent.

“Employees were called and were demanded resignation from, with absolutely no concern for a termination notice period, whatsoever, by the HR of the company. Employees have reported instances of mental harassment and of being coerced into submitting their resignations, under threats of malicious prosecution. All the while, all employees received constant mails mentioning how none of them shall be paid during the furlough,” an employee of Extramarks wrote in a LinkedIn post.

Another employee alleged that when asked about pending salary, their manager asked them to resign, after which their access to the portal was blocked and there was no response from the company.

The former employee even alleged that the company logged into their IDs, and sent in resignation on their behalf – something they only noticed later.

“A few days ago they blocked our Zimbra account. They blocked all our communication, or said they will call us back,” the employee added.

This, employees say, came after the company put them on furlough for the entire month of April, citing cash crunch.

Speaking to TNM, Swagata Roy, Director at Extramarks said that the company was forced to shut down several coaching centres, as a result of which it laid off only around 1% of its total workforce of 5000 employees. These employees, the Swagata says, were given their full and final settlements in accordance with their contract and that they are also helping them get placements where possible in other places where hiring is on.

“There are, however, a few disgruntled employees who weren’t happy with being laid off have taken to social media; but we haven’t paid much attention to that. We also have had some employees resorting to blackmail asking us to pay them for six months, failing which they will defame the company on social media. Rather than getting into negativity with a handful of people, we have ignored them. This is not something we want to stoop down to and get involved in. We are taking care of the rest of the 99% of employees who we know are happy, even at a time when there is no support from the government. COVID-19 has adversely affected the economy including all of us and we all have to share the burden. This negativity is coming from 4-5 people; we are not trying to pin them down or do anything against them,” Swagata added.

However, an employee TNM spoke to said that the company sent some employees a legal notice for defaming the company on social media. TNM has seen a copy of the legal notice sent to this employee.

Lendingkart

Ahmedabad-based Fintech lending startup Lendingkart has reportedly laid off nearly 200 employees. Employees have alleged that the HR and managers called them via Google Hangouts and WhatsApp calls and ask them to send in their resignation citing 'personal reasons' for the same. They also subsequently blocked from accessing their official email IDs. This employee alleged that nearly 500 employees across offices in Bengaluru, Ahmedabad and Gurugram were asked to resign. 

“Dear sir, I am employee of Lendingkart since last one and half year, but company forcefully demanded my resignation otherwise we would terminate you (sic). This time we wouldn't get job, please save our employment,” one employee wrote on Twitter.

TNM has reached out to the company and is yet to receive a response.

This came even as Lendingkart announced that it raised Rs 319.24 crore as part of its Series D round funding led by Fullerton Financial Holdings Pte Ltd, Bertelsmann India Investments, Sistema Asia Fund and IndiaQuotient.

And not just these companies, Twitter and LinkedIn has posts of disgruntled employees complaining of forced resignations from several other companies. However, TNM was unable to independently verify these claims.

Letting go employees ethically

Losing a job at this time comes as a major jolt, especially as there are uncertainties over finding another one amid the pandemic.

Layoffs are often the first consequence of a cash crunch in a company. And while larger companies and well-funded companies often have the bandwidth to offer a good compensation to laid off employees, smaller companies may not be in the situation to do so, says Sonica Aron, Managing Partner at HR consultancy firm Marching Sheep.

Everybody understands that there is an economic crunch. “Some say that they’re more than happy to take a pay cut, and that it’s better than not having a job. People are very scared of losing jobs,” she adds.

However, when you let an employee off, it is extremely important to give them the right communication.

“In times like these, if a company is forced to retrench, it has to be done in an empathetic and ethical manner like what AirBnb did. The norm is that you give a severance package as per your employment contract based on required notice period. Whether an employee resigns or is asked to leave, they have to give notice period,” Sonica says.

But forcing employees to resign and not offering them any compensation is ‘penny wise pound foolish’, she says, adding that it is better for the company to incur some cost and do it in the right manner.

“Otherwise it ruins your reputation for times to come. Most people who see this on Twitter, LinkedIn, etc. will now know how the company treats its employees and will not want to join. Companies have to understand that they too can grow only if they have the right talent, which they will not get if they resort to unethical methods,” Sonica adds.

Legal recourse

Sonica says that employees should look at employment contracts, see what it says and demand compensation accordingly – they are entitled to it, unless the organisation can prove that all these people were poor performers. “Even in terms of poor performance, you need to have some documentation such as poor rating during appraisals that say that this person was warned or told to improve performance, etc. You don’t decide overnight that someone is a poor performer,” she explains.

Some of the laid off and transferred employees of Indiabulls have now created a WhatsApp group to come together and take action.

“We have decided not to resign. We are planning to demand full salary, compensation as per our original CTCs with three-month compensation as per notice period,” an employee said.

An employee of Lendingkart told TNM that some employees have also filed a complaint against Lendingkart at a local police station in Ahmedabad and has also filed a complaint with the labour department in the state. As per a report on TV9 Gujarati, a report was filed in the Vastrapur Police Station in the city.