FIITJEE Holds Employee Salaries For Second Consecutive Month: Report (Image: X/@fiitjee)
FIITJEE, the renowned and oldest test preparation firm, has reportedly held back the salaries of its employees for the second consecutive month. Moneycontrol reported that the company’s management had told employees that it had deliberately suspended salaries to give them a “wakeup call” to work harder.
FIITJEE is one of the country’s largest IIT coaching chains. However, the firm is competing with new-age edtech startups like Physics Wallah, Unacademy, Allen, and Aakash to retain the market share. Moneycontrol, citing two executives at the company, reported that FIITJEE paid 50 percent of January salaries last week. However, the test-prep coaching centre has not paid the rest of the salaries. In February, Livemint reported that the company had suspended salary payments, citing cash flow issues.
FIITJEE was founded by Dinesh Kumar Goel in 1992. The company, which operates over 100 study centres in the country, delivers test prep courses for major entrance and competitive examinations. According to Moneycontrol, the organisation has a workforce of about 4,000 teaching and non-teaching employees.
The company, backed by Matrix Venture Partners, has also sent multiple e-mails to its employees over the past few weeks. “Coming to the office without clear goals will not take you anywhere. Salary is not a matter of right, it needs to be earned by doing what is expected of you to do,” said Dinesh Kumar Goel, the founder and managing director of FIITJEE, in one of the emails, as quoted by Moneycontrol.
Dinesh Kumar Goel reportedly told employees through e-mails that the firm gained massive success in its early days from the first centre in Delhi. The FIITJEE founder added that none of the centres have matched that success yet and have fallen much short in all aspects. Dinesh Kumar Goel also added in his email that the firm’s various interventions and strategic advice at the corporate level “have not been implemented in true spirit.”
The founder of FIITJEE also asked the employees to work with “renewed focus” to raise the level of performance of various centers. “Post that, on the basis of the achievements and commitments of the teams, we will immediately start releasing the salaries in line with the centre’s business plans,” added chairman Goel.
In another e-mail, which was sent on March 3, FIITJEE told employees that inefficient performance of centres and the failure to follow the chairman and management team’s advice were the reasons behind holding the salaries. As per the report, the organisation has not revealed any details on when employees can expect their dues to be paid.
Citing data from Tracxn, Moneycontrol reported that FIITJEE has been recording negative cash from operations for about eight of the past 10 financial years. The Delhi-based organisation’s revenue from operations increased 21 percent to Rs 542 crore in FY23 from Rs 448 crore in FY22. However, the firm has reported a loss of Rs 69 crore against a profit of Rs 37 lakh in FY22.
