Embattled edtech major Byju’s has handed pink slips to nearly 500 people without serving them notice period, or without putting them on a performance improvement plan (PIP), according to the sources.

Some employees have alleged that the company’s human resource executive informed them that the company had decided to terminate employment immediately.

“The HR went on to initiate the exit process immediately and I was informed that my last working day was that very day,” said one the employees who spoke to businessline.

This restructuring is part of the exercise announced in October 2023 by India CEO Arjun Mohan upon his appointment.

Byju’s spokesperson confirmed the development.

“We are in the final stages of a business restructuring exercise announced in October 2023 to simplify operating structures, reduce the cost base, and better cash flow management. As you are also aware, we are going through an extraordinary situation in the company because of the ongoing litigation with four foreign investors, where every employee and the ecosystem is going through tremendous stress, given the present circumstances,” said the spokesperson

“We regret the unfortunate situation the company has been forced into. Still, it is something that we will put behind us soon with majority investor support for the $200 million rights issue. We request everyone’s understanding of the individual and collective stress on the system, which might be prompting some unforeseen situations for the departing employees,” the spokesperson added.

Byju’s woes

On Monday, Byju’s had decided to hold off its staff salaries for the second month in a row as it awaits the National Company Law Tribunal (NCLT) order to use funds from the proceeds of the rights issue.

The company said it is following a parallel line of credit to ensure that employee salaries are disbursed by April 8.

This is the second time Byju’s has faced the same problem, as it had held back February salaries and later paid a part of the dues to employees in mid-March. The company is yet to pay the remaining February salaries to its staff.

Recently, the company concluded its extraordinary general meeting (EGM) to increase authorised share capital with no objections raised on the resolutions discussed, reported businessline.

Earlier, on March 29, Raveendran, in a letter to shareholders, said that in response to the postal ballot announced on March 7, the company received more than 50 per cent of votes in favour of increasing the authorised share capital.

The voting process for the resolutions discussed in the meeting will go on till April 6. Meanwhile, the next hearing for the plea filed by investors in the NCLT is scheduled for April 4.