Byju's introduces revenue-linked salary policy for sales staff: Report
EMBATTLED edtech company Byju’s has implemented a policy linking the salaries of its sales staff to weekly revenues, CNBCTV18 reported citing sources.
The new policy became effective on April 24 and will continue till May 21. It aims to address the company's financial strains by further incentivising sales performance, said the business news TV channel.
Base salaries for sales team members will be suspended during this period.
The new policy, which applies to the Inside Sales and Byju’s Exam Prep teams, entails distributing half of the weekly revenue collection to sales associates every week.
This move comes at a critical time for Byju’s, which has faced challenges in disbursing salaries and accessing funds. In April, the company announced it will borrow money to meet pending salary payments after encountering difficulties in accessing rights issue funds due to actions by foreign investors.
Byju’s has been embroiled in legal disputes with investors at the National Company Law Tribunal (NCLT) over allegations of oppression and mismanagement, as well as the use of rights issue funds. The NCLT recently deferred hearings in the matters to June 6, impacting the company's ability to address its financial obligations.
According to reports, Byju’s had hoped to utilise the rights issue funds to sustain its daily operations and cover the salaries of its 15,000 employees. However, NCLT's decision has hindered these efforts, adding to the company's financial woes.
The total salary expenditure for Byju’s is estimated to range between Rs 40 crore and 50 crore, further underlining the significance of the ongoing financial challenges facing the edtech giant.
