New Delhi: According to official statistics cited in publications, Byju’s failed to pay provident fund (PF) to the bulk of its employees for June despite a warning from the Employee Provident Fund Organisation (EPFO) last month regarding irregularities in PF contributions.
According to the data, Byju has already paid PF contributions to 738 employees in June, compared to 25,000 employees in May. Speaking with coworkers, it was established that June’s PF contributions had yet to be credited.
Byju released PF payments for 24,818 employees on June 26 last month after Moneycontrol and a few other media sites complained about a delay in PF payments. Before that, Byju had only made PF payments for 10,000–13,000 workers in January, February, and March and had skipped making contributions for April and May.
Byju’s claimed that the business had settled PF payments through May in a message addressed to the EPFO on June 27 that reports could view. Additionally, the company pledged to complete the PF payments for June by July 15.
According to multiple industry consultants, Byju’s delays in PF payments could be a sign of cash flow pressure at the firm. The edtech, last valued at $22 Billion, has also undertaken layoffs and given up office space, to save costs.
On July 24, it was also revealed that Byju’s had given up its largest office space in the nation while negotiating with lenders over its ongoing debt commitments and completing a long-delayed fundraising round. More than 2,000 people have already been formally let go by Byju’s, who has also converted the majority of its workforce on a contract basis. Byju’s had about 60,000 workers on its payroll in September 2022, per EFPO data.
Since the beginning of the year, Byju’s has been dealing with a variety of problems, including as a dispute with its lenders and the resignations of its directors and auditor, all while being investigated by government agencies like the EPFO and the Enforcement Directorate (ED). The Ministry of Corporate Affairs in India is apparently also looking into the company.
Last week, Byju’s also faced backlash from some of its Tuition Centeres employees, over nonpayment of variable pay and other incentives. Employees of Byju’s Tuition Centers (BTC), on which the company has been extremely bullish, were planning a nationwide protest against this. But in an emergency townhall on July 22, the company agreed to pay incentives from next month and said it will remit variable pay next quarter. Byju’s also assured BTC employees that it will not lay off any one from the vertical.
In March of last year, Byju’s reached a new high when it completed a sizable $800 million round at a $22 billion value. After its auditor resigned and three important investor board members left, the company, which has investors such as Peak XV Partners (previously Sequoia Capital India), Prosus, and Sofina among others, found itself in hot water recently.
Surprisingly, For FY21 (2020-21), Byju’s reported a significant increase in losses to over Rs 4,500 crore although its sales decreased little. FY21 was the first year of Covid, which gave online learning enterprises a boost.