Byju’s, the embattled edtech company, announced on March 10 that it has disbursed partial salaries to all employees for February. The company assured employees that the remaining balance will be paid once it gains access to funds from the recently concluded rights issue.
In a letter addressed to employees, Byju’s stated, “We processed partial salaries for all employees for February late on Friday, utilizing available capital outside the rights issue. The company will settle the remaining balance as soon as the funds from the rights issue become accessible, which we anticipate shortly.”
Moneycontrol has obtained a copy of this letter.
Management further noted that employees can expect to see the credited salaries in their accounts by March 11, as the processing was delayed due to the second Saturday and an extended weekend.
This development follows Byju’s founder, Byju Raveendran’s earlier commitment to pay salaries by March 10. The delay in salary disbursement was attributed to the funds raised through a recent rights issue being locked in a separate account, amid an ongoing dispute with investors.
Byju’s, grappling with financial constraints, has taken measures to ease the burden on its employees by disbursing partial salaries for February. The company assured its workforce that it will pay the remaining balance once it gains access to the funds from the recently concluded rights issue.
Sources close to the matter revealed that Byju’s has managed to pay full salaries to around 25 percent of its employees falling under a lower salary bracket. However, for the remaining 75 percent, only partial payments have been made.
In a bid to mitigate the impact on its employees, Byju’s has arranged alternative funding sources to ensure minimal disruption to their daily lives. The company reiterated its commitment to maintaining seamless operations and providing unwavering dedication to its students amid the ongoing challenges.
This development comes in the wake of a directive from the National Company Law Tribunal (NCLT) ordering Byju’s to hold the funds raised from the rights issue in an escrow account until the resolution of a plea filed by four investors alleging oppression and mismanagement.
Byju’s has faced a series of setbacks over the past year, including layoffs affecting thousands of employees due to funding constraints and a slowdown in online learning demand. The departure of several investor board members further added to the company’s woes, citing differences with founder Byju Raveendran.
To address these challenges, Byju’s has undertaken various initiatives, including capital infusion from early investor Ranjan Pai, the establishment of an advisory council featuring industry veterans, and the appointment of a new CEO. Additionally, the company is exploring asset divestments to streamline its operations and navigate through the turbulent times.