ClearTax lays off 16% staff amid restructuring; freshers hit hardest in strategic move

In a recent strategic move, ClearTax, now operating under the brand name Clear, has implemented significant layoffs, affecting 16% of its workforce, with fresh graduates and recent hires primarily impacted. The Bengaluru-based company executed these job cuts on August 1, attributing the decision to a broader organisational restructuring aimed at enhancing agility and preparing for future challenges. This decision has particularly hit those who were newly onboarded from campus placements, leading to considerable distress among affected employees.

A Clear spokesperson stated, "We recently undertook a broader strategic organisational restructuring, impacting around 16% of our workforce, including a small number of early-career employees. This was a tough decision, and we are deeply grateful to every individual affected for their contributions." The company has offered "enhanced severance packages, continued health insurance, and active outplacement assistance through outreach to industry partners."

The company provided an official statement to People Matters in response to the increasing online discussions and employee feedback on LinkedIn. 

Online criticism

The layoffs have sparked criticism, especially from young employees who joined the company shortly after completing their studies. Anoop Singh, a recent recruit from IIT-Guwahati, expressed his disappointment: "This decision felt profoundly unfair. To have this opportunity revoked before I even had a real chance to prove my long-term value — feels profoundly unfair." Similar sentiments were echoed by other affected individuals, underlining the emotional and professional impact of the layoffs.

Soojal Singh, another recent hire, mentioned, "All newly onboarded freshers were affected as part of broader business decisions." Additionally, some interns with full-time offers had their offers rescinded. The abrupt nature of these decisions has left many feeling unprepared and disheartened, having rejected other opportunities in favour of Clear's offer during campus placements. Despite the disappointment, some, like Manvendra Singh Holkar, see this as a temporary setback, stating, "While the news was unexpected and disappointing, I see it as a brief pause — not the end of the journey."

Gains-losses and layoffs

Clear's financial performance has shown notable improvement, with operating revenue increasing by 93% to Rs 209.84 crore in FY24 compared to the previous fiscal year. Losses have also decreased by nearly 59%, settling at Rs 96.24 crore. Despite this financial uptick, the company has not secured additional funding since its last Series C round in October 2021. This lack of fresh capital inflow has contributed to the company's decision to streamline its operations.

Clear, traditionally known for its e-filing tax services, has diversified its offerings to include finance, compliance, and supply chain cloud services, positioning itself as a comprehensive business solutions provider. This shift reflects the company's strategic focus on expanding its digital services portfolio, even as it grapples with internal restructuring challenges.