Paytm employees stare at 'voluntary resignations', firm denies layoff buzz

Paytm said the company is undergoing a routine appraisal process involving performance assessments which may lead to 'role adjustments'

One97 Communications (OCL), the company that operates the Paytm brand, is asking its employees to resign, citing restructuring in the organisation, people in the know said.

While the number of employees affected could not be ascertained, sources in the know said in some departments the impact was almost 50 per cent of the headcount. Some affected business units include the telco unit, marketing, and Paytm Payments Bank.

Last week, the company terminated the jobs of employees who had refused to resign.

Paytm said the company was undergoing a routine appraisal process involving performance assessments, which might lead to “role adjustments”.

What has surprised affected employees is that even those who got the highest assessment scores earlier have been asked to go.

“This is layoff under the cloak of voluntary resignation and is happening across multiple teams. If the company is looking to weed out employees with low performance, why have they asked me to resign? I was rated among the best in my team just a few months back,” an employee said.

Business Standard has reviewed the employee’s last performance management report along with the termination notice.

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Employees said “voluntary resignation” was happening in all departments in a phased manner and they expect additional verticals would be communicated about the decision in the next few days.

“Of 21 employees, 10 have resigned and a few more have been asked to put in their papers. In the app team, 15 of the 35 have resigned to date after being asked to,” another employee affected by the recent exercise said.

Other verticals including technology, product, and business have also been affected by this action, employees associated with the company posted on Grapevine, a social networking platform for professionals.

Paytm, however, has denied the allegations of layoffs and related exercises of employee resignation.

“We strongly deny any claims of layoffs within the company. Our focus continues to be on growth, innovation, and delivering seamless service to our customers. We urge stakeholders to rely on official communications for accurate information and disregard speculative narratives,” a Paytm spokesperson said.

Paytm has called its annual appraisal process involving performance evaluations that lead to “role adjustments” “a standard practice across many organisations, distinct from any layoff implications”.

But those impacted by this have a different take on this.

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“On our call with human resources when they asked us to resign, we were specifically told that this is not based on performance. Similarly, my performance assessment report for this entire year (FY24) is yet to be released. Also, will the number of underperforming employees be so many that they will account for nearly half a team?” an employee said.

The above-mentioned source said human resources was asking them to resign on video calls.

“After voluntarily resigning and serving the notice period, human resources has said that we will have a clean exit and it will not impact our experience and relieving letter, a full and final (F&F), and good feedback on our background checks. The question is what if I don’t put in my papers,” said one of the employees quoted above.

Human resources at the company has assured employees a “clean exit” in case they choose to resign.

Meanwhile, another person employed at the company suggested that OCL would restart hiring after reducing the headcount at lower salaries.

“What happens in such times is that the company will look to fill in the places where employees have resigned after a few months ... However, it does so with a reduced package in order to control employee costs,” the person said.

The company in the past has said that it is looking at using artificial intelligence to improve efficiency, which means hiring less. In January this year, the company had said it was focusing on tech-enabled systems to improve operational efficiency as it rationalised its employee cost structures, which includes revising its hiring strategy, focusing on contract employees, and a stricter performance appraisal.

“When the Paytm Payments Bank fiasco happened, OCL Chief Executive Officer Vijay Shekhar Sharma in an internal town hall had assured that there would be no layoffs, and regular hikes would be in place. The human resources and management have now asked us to put in our papers and asked to serve the remaining notice period of two months,” one of the affected employees told Business Standard.