UK challenger bank Revolut is facing accusations of having illegally forced employees to either quit or being fired for underperformance as the FinTech unicorn was looking to cut cost amidst the coronavirus pandemic.
The accusations were levied in a new expose by Wired. The publication said it had spoken to over 50 former staff members in Portugal and in Revolut’s Poland office, which is said to be bigger than the neobank’s UK headquarters.
One former employee said she had been caught off-guard in a call with her team leader. The conversation was supposed to have been a catch-up. However, the employee was quickly forced to choose between two documents.
The first was a mutual agreement that offered her a small severance in return for stating that she left the company of her own free will. The second document said she would be fired for underperformance, something that shocked her as she had been told a few weeks earlier that she had been performing well. The employee said she had only been given 30 minutes to pick one of the options. She decided to quit of her own accord.
Wired reported that several staff members, both former and current, claimed they had witnessed employees forced out despite the company having no legal grounds to oust them. Many of the former workers were foreign nationals who said they had now found themselves unemployed in a foreign country amidst a global health crisis and at risk of losing their visas.
Wired said it had reviewed the documents given to employees and their testimonies with experts in Polish employment law. The experts said that Revolut could’ve been in breach of the nation’s employment laws.
While confirming that staff had left the business, Revolut denies to having broken any laws. “As in many companies, COVID-19 necessitated cost cutting across our business and, in the last resort, we made 62 redundancies globally, representing less than 3% of our staff,” a Revolut spokesperson told FinTech Global. “Revolut strives to create a positive culture with a workforce that is motivated to achieve the best they can for our customers. Where employees leave the business we aim for this to be as painless as possible and, in every case, we fully comply with local labour law requirements.”
Revolut has previously announced several measures to cut costs during the coronavirus crisis. These included voluntary salary sacrifice schemes and to reduce outsourcing costs. According to Wired, 60% of the staff had opted into the salary sacrifice scheme that saw them exchange wages for shares in the neobank worth twice part of their salary.
However, while this scheme was supposed to be voluntary, Wired reported that some of its sources had been nudged by their team leaders to opt in, being told that that unless they complied, “other steps” could become necessary.
Legal experts speaking with Wired said that this type of scheme could be illegal in some jurisdictions where Revolut is operating such as Portugal, where the company announced the opening of a new office in September. Although, Wired said that there was no hint of the company having coerced any Portuguese employees to accept the scheme.
The news comes after Revolut’s CEO and founder Nikolay Storonsky issued a statement in March about the global pandemic and what it meant for the FinTech unicorn.
“The last weeks have been tough everywhere so I’d like to start this message by sending my best wishes to you and your family,” Storonsky said. “You have my word that we are doing everything we can to support our customers at this challenging time.
“The Coronavirus pandemic is causing unprecedented movement in financial markets. Naturally this can be alarming and can allow rumours and false information to spread quickly. To put your mind at ease, I’d like to make Revolut’s position super clear.”
He added that because it is a digital bank with digital networks, it would be able to keep supporting its staff. Similar statements had been issued by other European challenger banks FinTech Global had spoken with. In March, both Revolut and its UK rival Monzo had to respond to rumours on Twitter that it was going bust. Both challenger banks denied the rumours.
This is not the first time that Revolut has found itself landing in hot waters because of matters relating to how it treated its employees. In 2019, Wired published a story that suggested that the UK challenger bank’s meteoric rise – which has seen it become Europe’s arguably most valuable FinTech company after securing a $5.5bn valuation earlier this year – had been fuelled by a culture that had people work without pay, unachievable targets and high staff turnover.
That story had alleged that candidates had been asked to recruit 200 clients just to be considered for roles, a practice Revolut later stated that it had put a stop to.
In the aftermath of the 2019 story, Storonsky inked an open letter, saying that the company had not “always gotten things right” and that the challenger bank was “not the same company that we were 12-18 months ago, when these mistakes were made.” Storonsky added that Revolut had completely overhauled its recruitment process.
“Like everyone else at Revolut, I am constantly learning and growing with the company,” he said. “I now know that there is much more to running a successful business than simply hitting targets. Over the last 18 months, we’ve spent a lot of time working on our culture.
“We now conduct biannual surveys where we ask our employees what we’re doing well and where we need to improve. We’ve introduced new 360 performance reviews to make them more fair and transparent.”
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