Salarium halts operations amid salary disbursement trouble (Updated)

Salarium founder Judah Z Hirsch / Photo credit: Salarium

Salarium, a Philippines-based payroll automation startup, has suspended its operations indefinitely from December 31, 2023.

In an email sent to clients – which was reviewed by Tech in Asia – Salarium mentioned “issues affecting its ability to continue operating effectively,” including an incident happening on December 18. It had “until now been unable to be resolved,” leading to the shutdown. The email mentioned that all customer data will be deleted from its databases.

Salarium founder Judah Z Hirsch confirmed the suspension of its payroll software services to Tech in Asia.

“Last December we were affected by some technical issues that we could not resolve with the current operating team and thus needed to suspend the services,” said Hirsch. The company had to lay off nearly 20 staff members amid the shutdown.

A report published in September 2023 said that the startup had faced a technical glitch, after which it froze its disbursement feature, forcing clients to pay cash to their employees.

Hirsch told Tech in Asia that Salarium had to suspend its SalPay disbursement services in August due to “an ongoing issue” with its partner financial institution that Salarium is still hoping to resolve.

Alleged disgruntled clients had late last year said that the freeze had affected 10,000 employees and 500 local businesses, which amounted to around US$4.5 million in losses. However, Hirsch said the amount in dispute is “exponentially less than the amount quoted.”

“We hope to be able to resolve all the issues in due time and perhaps relaunch the service again in the future,” added Hirsch.

Founded by Hirsch in 2013, Salarium offered businesses with HR services such as attendance tracking and expense and salary reimbursements on a single platform.

In 2015, it won US$500,000 from Seedstars World, a global startup competition for emerging markets and fast-growing startup scenes. In 2018, it had raised US$13.5 million in an initial coin offering.

See also: Behind Sorabel’s shutdown: could it have been avoided?

Update (Jan. 9, 11:30 a.m. SGT): This article was updated to include a statement from Salarium founder.