Amid reports of Byju’s term loan B issue, edtech giant Byju’s has started laying off employees across departments to cut costs amid increased tension with lenders, according to a Moneycontrol report. It added that the company’s HR team conducted individual discussions over phone calls and in-person meetings at its offices on June 16 to communicate the layoffs to employees from various departments, such as mentoring, logistics, training, sales, post-sales, and finance.
The number of layoffs is likely to be above 1,000 employees, mostly senior staff who have spent over 2 years, according to the report.
The report, quoting people aware of the matter, said that after the discussions, the employees were asked to resign voluntarily on the company’s HR portal. Apart from this, they have been asked to submit employee IDs, and their email IDs have been deactivated.
“Employees were told on Friday (June 16) that it would be their last working day. There was no prior communication. Following some reports in the media, employees were constantly asking the HR and their managers if there would be any layoffs but we heard there wouldn’t be any,” said one of the people, according to Moneycontrol.
“After almost every development, employees get a mail from Byju Raveendran, where he says there will not be any more layoffs, the company is doing great, etc. But since October, there have been at least two major rounds of layoffs, this included,” the person added.
In February, Byju’s laid off over 1,000 employees. Out of these, 15 per cent staff were in the engineering roles. It also said all freshers had been fired by the company in the latest round of layoffs.
In June 2022, Byju’s had said it will lay off about 2,500 employees across departments to cut costs amid mounting losses. “To avoid redundancies and duplication of roles, and by leveraging technology better, around five percent of Byju’s 50,000-strong workforce is expected to be rationalised across product, content, media, and technology teams in a phased manner,” the company had said.
Recently, Byju’s skipped paying $40 million in interest payments on the term loan it had raised in November 2021. Following this, the company also filed a case against one of its lenders in the New York Supreme Court and also sought disqualification of the lender and called it “predatory”.
The lawsuit was, however, term “meritless” by the group of lenders, who they say collectively own more than 85 per cent of Byju’s $1.2 billion term loan.
In late-April, the ED also conducted searches on Byju’s as part of a foreign exchange violation probe under the provisions of the Foreign Exchange Management Act (FEMA). A total of three premises, two businesses and one residential, of Byju’s CEO Raveendran Byju and his company were raided.
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