Labour Commissioner summoned Paytm in case of illegal termination of employees

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The Regional Labour Commissioner of Bengaluru has summoned One97 Communication, the parent firm of Paytm, in connection with the alleged forced termination of employees. This development follows a series of complaints filed by the employees with the Ministry of Labour and Employment, accusing the company of violating laws and forcing terminations without pay.

Notice and Request for Appearance

The notice was issued by the Regional Labour Commissioner (Central), under the Office of the Deputy Chief Labour Commissioner (Central), Ministry of Labour and Employment. Representatives from the Paytm management and complainants have been requested to appear at the department’s office along with all relevant records.

Response from Paytm

In response to queries, a Paytm spokesperson stated that the decision to transition some employees has been a difficult one for all parties involved and was made only after careful consideration of all available options. The company claims to have strived to provide the best possible support to its transitioning employees and ensure fairness and transparency throughout the process. The spokesperson also mentioned that the company is actively listening to the feedback from affected employees and collaborating with all stakeholders to ensure the best for its employees.

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Complaints and Restructuring Efforts

The aggrieved employees, who were forced to “voluntarily resign” without prior notice or any severance package, had filed their complaints through the ministry’s Samadhan portal and other public grievance modes along with relevant emails and documents, seeking reinstatement of their jobs. This situation arose following the RBI’s decision to ban Paytm Payments Bank, leading to a massive restructuring, including employee rationalization. Founder and CEO Vijay Shekhar Sharma had mentioned in a letter to shareholders that the company will focus on its core businesses and improve cost efficiencies to create a leaner organization, hinting at the likelihood of layoffs in the future. The company claimed to have provided outplacement support to employees who resigned as a part of the restructuring efforts.

Conclusion

The situation at One97 Communication (Paytm) has raised concerns about alleged forced terminations and violations of labor laws. The company’s response and the ongoing developments indicate a complex and challenging situation for both the employees and the management.

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