India’s most valued edtech Byju’s has missed its own timeline to disburse performance-linked income to its tuition centre staff, amid mounting challenges at the firm.
Mrinal Mohit, the de facto head of the Byju’s Tuition Centres (BTC) vertical had said in an employee townhall in July that the company would be paying variable or performance-linked income and other incentives to the entire staff with their September salaries.
But at least seven employees have confirmed to Moneycontrol that these incentives were not paid with September salaries. Further, there has been no formal communication from the management about when this will be disbursed.
The company had initially agreed to disburse the performance-linked income in May, but it didn’t do so and there was no communication from the company about it until the last week of July when Mohit addressed employees. Moneycontrol was the first to report about the townhall then.
Performance-linked income is paid to employees every quarter and the company has not been disbursing this since the September quarter of 2022, employees said.
“PF payment has not been regular, we haven’t gotten incentives (including non-cash ones like Sodexo coupons), and variable pay has not been paid. Mohit, in the townhall, gave us an example of how even top tech companies like Microsoft are holding back incentives due to the current slowdown to defend their decision to not pay us” the person added.
In addition to BTC employees, Byju's has also withheld variable pay and incentives from employees in other departments, sources said. Performance-linked incentives are paid to all employees, just as BTC employees, on a quarterly basis.
However, these employees were not provided with any specific timeframe for receiving their payments. In fact, they have been making efforts to inquire about the disbursement schedule from their managers and the HR department but have not received any clear communication on the matter.
“A part of the incentives due have already been paid to the employees. As committed, the rest of the dues will be paid to employees in a staggered manner,” a spokesperson for Byju’s said, in response to queries.
Byju’s dues to employees underscores the startup’s struggles, as it grapples with multiple challenges. It is in talks with lenders to reach a settlement on a $1.2 billion loan, is awaiting a long pending fund infusion, is racing against time to file its FY22 and FY23 financials and is putting processes in place after three investor board members stepped down in June, over differences with the founder Byju Raveendran’s style of running the company.
In July, the company also gave up its biggest office space in Bengaluru and reduced some staff. Byju’s has also come under fire for delaying provident fund payments to employees. The company also has not done appraisals for FY24 yet, which typically, happen within the first quarter of every financial year.
But the company has been taking steps to rebuild itself from these challenges.
Last month, Byju’s formally announced the appointment of Richard Lobo, an Infosys veteran as its HR head, a move aimed at reducing the company’s employee-related issues.
Byju’s, also roped in industry veterans TV Mohandas Pai and Rajnish Kumar in July as advisors to its board after three key investor board members Peak XV Partners’ GV Ravishankar, Prosus’ Russel Dreisentcok and Chan Zuckerberg Initiative’s Vivian Wu resigned due to differences with founder Byju Raveendran.
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