Was Sebi’s HR Sidelined In A Power Play By Leadership?

“Baat hasraton ki nahi, baat izzat ki hai, Baat kaam ki nahi, par karane ke tareege ki hai, Humne nahi chaha tha ke baat is mod pe aaye, Par ab baat humse hamara SEBI cheen lene ki hai.”

On the morning of Thursday, 5 September, nearly 500 Securities and Exchange Board of India (Sebi) employees took to the streets outside the regulator's Mumbai headquarters, demanding accountability from their leadership. Their grievances? A toxic work culture, unrealistic performance targets and, notably, a sense of mistrust between employees and senior management. But beneath this employee-led uprising lies a critical question: What role has Sebi’s HR department played in this escalating crisis and why has it seemingly failed to act?

BW People obtained access to the employee grievance letter titled ‘Grievances of SEBI Officers – A Call for Respect,’ which was submitted to the finance ministry last month. The grievance letter is attached below. 

The Growing Rift: Leadership Vs HRD?

The internal unrest within Sebi raises the possibility of a divide between the leadership and the human resources department (HRD). The protest stems from unaddressed grievances that have worsened under the current management. While Sebi employees detail allegations of mistreatment and unrealistic demands in their grievance letter, there is an absence of effective intervention by HR. It begs the question: Has the HR department been sidelined in a larger power struggle with senior leadership?

“However, disheartening it may sound, in recent times, there has been a tectonic shift in the approach of the top management in the way it approaches its employees and behaves with them,” the letter states. 

At first glance, the grievances documented in the letter reflect typical employee concerns such as overbearing management, unrealistic key result area (KRA) targets and toxic office culture. However, the larger issue remains the HR’s inability to mitigate these problems. Employees assert that they have repeatedly raised concerns through both formal channels and informal discussions, yet no decisive action has been taken by HR to address or resolve them.

“The employees and employees’ associations have on various occasions informed the top management, Chairperson, and HRD through written as well as informal communications about the issues and grievances being faced by the employees on a regular basis. However, no decisive measures have been taken in that regard so far.”

Pressured Into Silence?

One of the most troubling aspects of this crisis is the perception that Sebi’s HRD may have been pressured into silence or compliance. The grievance letter mentions instances where HR failed to defend employees who faced public humiliation or unfair treatment at the hands of senior management. Employees have reportedly endured scolding, shouting and even public reprimands during meetings, while HR either stayed silent or was complicit in enforcing new regressive policies.

The introduction of point-based KRA systems with ever-shifting goalposts, along with invasive monitoring tactics such as minute-by-minute tracking of employee movements, is a prime example of policies that HRD failed to push back on. While it’s clear these systems were implemented to increase productivity, their impact on employee well-being has been overwhelmingly negative. Why did HR not step in sooner to question these tactics? 

“In the name of increasing the efficiency of an organisation which was already working as well-oiled machinery, the management started to overhaul all the systems and replaced them with regressive policies and frameworks. Sometimes it is the point-wise KRA systems with unrealistic targets with changing goalposts, other times it's the monitoring of minute-by-minute movement of SEBI employees. At one time, the employees will be called names, and at other times they would be shouted at by the leadership with no defense from top management”, the letter adds. 

Moreover, mental health issues have skyrocketed within the organisation, with counsellors now overwhelmed by the number of employees seeking help. Despite this clear indication of a toxic work environment, the HR department’s only notable action was to expand counselling services, hardly a solution to the broader cultural problem. This reactive approach further calls into question HR’s ability to advocate for employees or stand up to leadership when needed.

The employees further complained stating, “The SEBI which used to be a place where people used to work joyously and efficiently has become a furnace of unrealistic KRA point achievement. The same could be evidently correlated from the fact that the mental health counselor for employees at SEBI, who earlier used to have very few visitors, is now overburdened with employees facing mental health issues. As a result, HRD has increased the number of visit days and had to open up unlimited mental health counseling for employees as well.”

Leadership's Overreach Or HRD’s Weakness?

What’s most concerning about this scenario is that HR seems to have become an extension of senior leadership rather than an independent department capable of safeguarding employee rights. The grievance letter explicitly points to the tactics used by senior leaders, pitting HR against other departments like IT. This manipulation has allowed leadership to dodge accountability while scapegoating HR for its failures.

“Further, it is being regularly seen (including in the previous town hall meeting) that an effort is being made to pit employees against some departments, such as HRD and ITD. This approach by some only seeks to destroy the long-standing culture of SEBI. Both these departments are working under immense pressure, and all the employees of SEBI empathise with them very well. But the root cause of employees’ discontent is not those departments but the actual decision-makers at the highest level. These departments are only made a scapegoat when conversations arise’, the employee grievance letter adds. 

The installation of swing barriers to monitor intra-day attendance, for example, was framed as an HR-led initiative to improve productivity. Employees, however, viewed it as a stark reminder of the growing mistrust between leadership and staff. While the barriers were eventually removed, the damage to HR’s credibility was done. The department was seen as complicit in the leadership’s efforts to control and monitor employees’ every move, rather than defending employee autonomy or well-being.

“HRD in its office intimation dated July 24, 2024, categorically mentioned that the swing barriers were installed for monitoring intra-day attendance. Unfortunately, this entire exercise showed to employees the complete and utter lack of trust that people at the highest level have towards their own employees and also showed that they want to be in complete control of every movement of employees. Further, swing barriers pose greater challenges for employees with visual impairment.”

What Went Wrong In HR?

If there’s one thing that stands out in this entire episode, it’s the growing sense of mistrust between Sebi employees and their HR department. Employees feel betrayed by HR’s inaction in the face of repeated leadership overreach, raising an important question: Is this truly a leadership crisis, or is it also a crisis of HR’s ability to protect its workforce?

There are several reasons why HR might have been unable or unwilling to act. One possibility is that HR has been operating under pressure from senior management, forced to comply with directives that contradict its role in maintaining a healthy, safe, and respectful work environment. Alternatively, HR may lack the authority within Sebi to push back against top leadership, making it a mere enforcer of policies rather than a champion for employees. 

The absence of meaningful action from HR is not just a failure of department leadership, but it points to a structural problem within Sebi. 

Will HR Step Up?

As the protests outside Sebi’s Mumbai office suggest, the frustration among employees is palpable. But what remains to be seen is whether the HR department will take the necessary steps to restore trust. For employees, the path forward involves tangible reforms, such as a 360-degree feedback system that evaluates leadership and management practices. Employees are also demanding that HR leadership undergo training in modern HR practices, with the hope that this could realign the department’s priorities with the well-being of the workforce.

“In addition to the regular comments sought from SEA, HRD should conduct regular surveys of all employees of SEBI and conduct separate meetings with SEA members to enable communication on specific grievances. This can help in getting feedback and understanding the ground-level issues faced by employees. It is vital that people at the highest level acknowledge the growing discontent and consider strategic approaches to achieve compliance and harmony”, the frustrated employees demand.

The withdrawal of invasive policies like intra-day attendance monitoring and swing barriers is another pressing demand, highlighting the urgent need for HR to focus on rebuilding trust. In an organisation like Sebi, where the stakes are high and decisions impact the entire financial ecosystem, a toxic internal environment can have far-reaching consequences. 

The crisis at Sebi has exposed a rising disconnect between leadership and employees, but perhaps more importantly, it has revealed the fragility of HR’s role within the organisation. Whether the department was pressured into silence or simply failed to act, one thing is clear: HR must now decide whether it will be a part of the problem or the solution. 

The growing unrest, driven by frustration has turned the spotlight on Sebi's HR department. With employees demanding reforms and a more supportive environment, HR now faces a crucial test: Will it step up and reclaim its role as an advocate for employee well-being or continue to stay silent, losing the trust of the very people it is meant to protect?