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Paytm Employees Asked To Resign Amid RBI Ban

By Nithya Bose in Business News, posted June 17, 2024

Numerous employees at Paytm are being asked to "voluntarily resign" without prior notice.

Several current and former employees said many are being denied severance pay and are required to repay joining and retention bonuses.

This came after the Reserve Bank of India ceased operations at Paytm Payments Bank and its wallet business.

"I started crying at the meeting. I told them that I was willing to work even at a lower salary and designation," said one Paytm employee facing an imminent job cut.

Last month, HR representatives contacted this employee by phone, informing them that their role would be terminated due to organisational restructuring and requesting their resignation by early June.

The fintech company has not provided formal communication detailing the restructuring process and subsequent job losses to the affected employees and has prohibited recording HR meetings.

An employee claimed: "The calls with HRs are being labelled as 'connect' or 'discussion'. There is no formal documentation of any kind."

A review of some Paytm offer letters revealed that joining and retention bonuses are "recoverable" if an employee "leaves the employment" within 18 months of starting the role.

In some cases, this clause also applies to terminations "for any cause."

For those without this termination clause in their offer letters, Paytm asserts that it is specified in their appointment letters issued post-joining.

Employees reported that many did not receive appointment letters via email or postal delivery, and those who did were never asked to sign or acknowledge them.

A company spokesperson said: "We strongly deny allegations pertaining to any forced action on employees or unfair treatment.

“We have rigorously ensured that our HR teams have informed employees about their termination through official channels only.

“Further, we would also emphasise that all transitions are duly undertaken as per norms laid out in the appointment letter of these employees.

“To help them adjust and plan their next move, we are honouring full notice periods of these employees while also extending additional support such as outplacement and processing of due bonuses at the time of their full and final settlements.

“Our focus remains on building a leaner organisation that is well-positioned to deliver long-term sustainable growth and value to our stakeholders.

“We remain committed to supporting our employees during this transition."

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A former employee, whose services were terminated because he refused to resign said Paytm did not provide an experience letter.

While many employees have chosen to resign voluntarily in recent months due to fears of receiving termination notices, some are fighting back.

These employees have refused to resign, voiced their concerns to Paytm's internal employee escalation team, and advocated for a "fair exit process."

The affected employees have also formed a social media group to discuss and determine their next steps.

Some seek legal advice, with at least one employee having already filed a complaint with the labor ministry.

If an employee raises a complaint with Paytm's employee escalation team, the company is supposed to investigate and present a report.

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