BYJU's reportedly owes its former employees about INR 4.5 Cr in unsettled dues
The edtech company has reportedly pledged to clear all dues owed to former employees within a month of receiving a relief order from the NCLT
This comes just days after the corporate affairs ministry said the probe into BYJU's affairs was still "ongoing", refuting reports that the company had been cleared of financial fraud
Trouble seems to be mounting for BYJU’S
as now Karnataka Labour Minister Santosh Lad has asked the embattled edtech startup to settle the overdue salaries of its former employees “at the earliest”.
During a meeting with the representatives of BYJU’S parent entity Think and Learn Pvt Ltd, the minister flagged concerns over the outstanding dues owed to its former employees, Moneycontrol reported.
As per the report, Lad told BYJU’S officials to “settle at least 50% of the dues owed to former employees at the earliest” and sought assurance from the company that it will settle the remaining dues in due time.
BYJU’S has reportedly informed the Karnataka government that its funds are currently kept in an escrow account with the National Company Law Tribunal (NCLT).
It is to be noted that the NCLT earlier barred BYJU’S from using the proceeds from the second rights issue and asked it to park the funds in a separate account till the settlement of the case.
The hearing on the plea is scheduled for Thursday (July 4).
The edtech company has reportedly pledged to clear all dues owed to former employees within a month of receiving a relief order from the NCLT.
Inc42 has reached out to BYJU’S for a comment on the development. The story will be updated based on the response.
This comes after Karnataka’s labour department reportedly received a barrage of complaints from about 160-200 former BYJU’S employees, alleging the edtech firm had not settled dues worth nearly INR 4.5 Cr owed to them, even months after their termination.
It was earlier reported that founder and CEO Byju Raveendran took personal debt to clear part of the overdue employee salaries for the month of March.
Meanwhile, BYJU’S has also cut fixed salaries of new hires by 90%, sources told Inc42.
Once the world’s most-valued edtech firm, BYJU’S has been facing pressure from all directions from shrinking revenues to funding vacuum and consequent mass layoffs to legal trouble with the NCLT and probe by the Enforcement Directorate.
Last week, the Ministry of Corporate Affairs said that the probe into potential governance lapses at BYJU’S was still “ongoing” and that reports claiming the edtech major had been cleared of financial fraud were “inaccurate and misleading.”
Last month, US-based asset management company Baron Capital cut BYJU’S valuation by more than 99% to $120 Mn as of March 31, 2024.
Adding to its woes, Netherlands-based Prosus, which holds a 9.6% stake in BYJU’S, wrote off its entire investment in the edtech firm.
Furthermore, OPPO has moved the NCLT, alleging BYJU’S owes the smartphone manufacturer INR 13 Cr.
