Byju's Salary Crisis: Byju gave some part of February salary to employees, said this about the remaining payment
Byju's Salary Crisis: Byju's has paid some part of the salary of its employees for February. The company told the employees that we have made arrangements for alternate funding so that there is no interruption in their daily work. The company is currently struggling with a lack of funding and litigation with investors. Know what the company said about paying full salary to its employees?
The ed-tech startup Byju has partially paid all of its employees' unpaid salaries for February due to internal conflict and a financial crisis. According to Byju Ravindran's company, the remaining salary will be paid as soon as the NCLT gives the go-ahead it to use the funds from the rights issue.
Byju claims that capital raised separately from the rights issue was utilised to pay the workers a portion of their salary late on Saturday, March 9. The company let the employees know that other funding arrangements have been made so there wouldn't be any interruption to their regular workdays.
Earlier, Byju's founder Byju Ravindran had said that the company would pay the salaries of the employees by March 10. He hoped that by then he would get permission from the National Company Law Tribunal (NCLT) to use the money raised from the rights issue.
Four investors of Byju's have accused the company's management of harassment and mismanagement. Hearing this, NCLT had ordered on February 27 that until this petition is resolved, the money received from the rights issue will remain in a separate escrow account.
Once regarded as one of the best startups in the nation, Byju's is currently going through a very challenging time. First off, the trend towards online learning has slowed since the end of the coronavirus. However, funding from venture capital has also declined.
In the past year, Byju's has let go of thousands of workers under the pretence of cost-cutting. The company's problems are being exacerbated by its litigation and disputes with numerous investors. A large number of the investor board members also left, citing disagreements with Ravindran.
Byju's shareholders had voted in favour of removing founder and CEO Byju Raveendran and his family from the board at the extraordinary general meeting (EGM) on February 23, alleging mismanagement and failure. At present, there are only three people on the board, Ravindran, his wife and his brother.
Byju's argued that since the founders were not present at the EGM, the decisions taken in it were invalid.
