Kuda and CEO Face Sex Discrimination & Unfair Dismissal Allegations

Kuda Technologies Faces Tribunal Case Alleging Workplace Misconduct

Kuda Technologies, a rapidly expanding digital bank operating in Africa, is currently facing legal scrutiny. An employment tribunal case has been brought forth concerning allegations of workplace discrimination, harassment, and unjust termination of employment.

Details of the Complaint

Rosemary Hewat, formerly the group chief people officer (CPO) at Kuda, initiated the complaint. She accuses both the company and its CEO, Babatunde Ogundeyi, of sex discrimination, victimization, and unfair dismissal from her position.

According to the legal filing, Hewat, who served in the senior role for almost three years, asserts that she was compelled to leave the company in April 2024 following a period of sustained mistreatment. The case was submitted to the U.K. Employment Tribunal, and documentation related to the claim has been reviewed by TechCrunch.

Internal Conflicts and Workplace Culture

The complaint highlights internal disagreements within Kuda, a provider of digital banking services to a substantial customer base in Nigeria and the U.K. It also sparks wider discussions regarding workplace culture, leadership responsibility, and gender equality within the African technology sector.

Hewat has declined to comment on the ongoing legal proceedings. A full hearing regarding the case is scheduled for October.

Kuda’s Response

A spokesperson for Kuda acknowledged Hewat’s claim, stating: “It is accurate that Rosemary Hewat, a former employee of Kuda Technologies Limited UK, has made an employment tribunal claim against the company.”

The spokesperson further added that, due to the legal nature of the matter, the company is unable to provide further details at this time. Kuda maintains a policy of not commenting on legal issues involving current or former employees to protect privacy.

Allegations of Discriminatory Behavior

Hewat was hired in August 2021 to oversee global HR operations from Kuda’s U.K. office. The filing details that she both witnessed and experienced behavior that was inconsistent with Kuda’s stated diversity, equity, and inclusion (DEI) policy.

She alleges that CEO Ogundeyi and other leaders actively undermined her authority, cultivating an environment characterized by misogyny and intimidation.

Specific Incidents Described

The filing recounts an incident that occurred during a company retreat in Lagos, Nigeria, in December 2023. Hewat claims that Ogundeyi publicly reprimanded two female employees, reportedly labeling them as “low class” and criticizing their perceived lack of “quality or luxury,” which caused them significant distress.

Hewat contends that this event was indicative of a larger pattern that created an “intimidating, hostile, degrading, humiliating, and offensive” workplace for herself and other women at Kuda.

Perception of Authority

The complaint further alleges that Ogundeyi expressed a belief that employees viewed him as having a god-like status and were fearful of approaching him.

Exclusion from Key Discussions

According to the filing, Hewat was excluded from crucial strategic discussions. In January 2023, then-COO Pavel Khristolubov allegedly omitted her from a senior management meeting, despite her team’s responsibility for resourcing decisions that were on the agenda.

When Hewat inquired about her exclusion, Ogundeyi reportedly stated that the meeting focused on product strategy, rendering her presence unnecessary. Subsequently, her team was pressured to implement resourcing decisions originating from that meeting.

Bypassing Authority and Performance Reviews

The filing indicates that Khristolubov allegedly circumvented Hewat’s authority by communicating directly with her team members. When Hewat voiced her concerns to Ogundeyi and CTO Mutairu Mustapha, her concerns were reportedly dismissed.

During a performance review, Ogundeyi allegedly advised Hewat to “spend the next six months getting Pavel to like you.” Hewat argues that this statement contributed to a toxic work environment and hindered her ability to effectively fulfill her role.

Threat of Dismissal

By October 2023, Hewat formally proposed a review of internal systems to address the issues she had with Khristolubov. Instead of addressing her concerns, Ogundeyi allegedly threatened her with termination.

Dispute Regarding Equity Compensation

The core of Hewat’s legal action centers around an outstanding disagreement concerning her employee stock options (ESOP). Upon commencing her employment with Kuda, she asserts the company extended an offer of ESOP shares valued in the hundreds of thousands of dollars, based on the company’s Series A valuation.

However, despite repeated requests, formal documentation confirming this grant was never provided to her.

The ESOP grant was ultimately issued by Kuda in April 2022, but it was calculated using the Series B valuation. This resulted in an increased stock price and a corresponding decrease in the overall value of her equity, as detailed in the filing.

Hewat alleges she subsequently learned that Steven Bastian, who was then serving as CFO, had successfully negotiated for his own shares to be valued at the earlier Series A price.

When Hewat voiced her concerns, Ogundeyi reportedly dismissed her request, stating that Bastian’s position held greater importance than her own.

In December 2023, Hewat formally recorded her concerns regarding share allocations, alongside issues of pay inequality, according to the filing. She cautioned Kuda that a failure to address these matters could potentially be construed as sex discrimination under U.K. employment legislation.

Ogundeyi responded by rejecting her claims, maintaining that she possessed no contractual right to shares at the Series A valuation.

“We note that you have not provided any correspondence (emails, letters etc) to substantiate your claims and we assume that is because there is no evidence,” Ogundeyi communicated to her, as stated in the filing.

“The terms of your employment and option grant are as set out in writing to you; even if someone did suggest to you that you might receive something different (which is not accepted), that does not create a contractual entitlement.”

Despite Ogundeyi’s assurances that Kuda would investigate her complaint, no formal investigation was initiated, the filing indicates. Hewat contends that Ogundeyi declined mediation and personally oversaw the internal review of his own conduct, ultimately finding in his favor.

She argues this action was a violation of Kuda’s established grievance procedures and the ACAS Code of Practice concerning workplace dispute resolution.

Hewat claims that her efforts to resolve these concerns in January 2024 allegedly led to a deterioration in her professional relationship with her former supervisor. She asserts that he exerted pressure on her to retract her discrimination complaint, a request she declined.

Abrupt Termination and Subsequent Repercussions

In February 2024, Kuda initiated the dismissal of Hewat, who was based in London, while she was en route to Lagos for an executive committee (ExCo) meeting. This occurred shortly after her attendance at her sister’s memorial service, during a layover when Ogundeyi requested a video conference. Hewat alleges she was terminated during this call, despite having informed him of her personal circumstances.

Reportedly, Kuda prevented Hewat from participating in the retreat to which she had traveled, a move she perceived as a deliberate act of public humiliation. A subsequent in-person meeting with Ogundeyi resulted in explanations citing economic instability within Nigeria and the necessity for cost reduction as the rationale for her dismissal.

“Significant alterations are being implemented, and change is undeniably required… there have been numerous interpersonal conflicts, and you are centrally involved,” Ogundeyi purportedly stated. He further commented, “Your compensation may be adequate in the U.K., but you represent a substantial expense for Kuda… what justification does Rosie have for her salary? The primary factor is exchange rates.”

The filed documentation indicates Ogundeyi asserted that her termination was unconnected to the discrimination claim, share allocations, or her relationship with Khristolubov. However, Hewat maintains that Ogundeyi still referenced her association with Khristolubov during their conversation. (Khristolubov ultimately departed from Kuda two months later, in June 2024.)

Hewat contends that Kuda extended the same severance package to her as was offered to Khristolubov, despite his status as a contractor versus her position as a full-time employee. She posits that her dismissal was retaliatory, stemming from her complaints regarding workplace discrimination, emphasizing that she was the sole U.K.-based executive to be let go.

In response to Kuda’s invitation to engage in redundancy consultations, Hewat countered by arguing the company’s financial stability, pointing to its expenditure of £55,000 annually on a nanny for Ogundeyi’s children, as detailed in the filing.

Despite Ogundeyi’s alleged commitment to confidentiality, news of Hewat’s dismissal rapidly circulated within Kuda. When she contacted him regarding this breach, she claims her communication was disregarded.

Further complicating matters, CTO Mustapha reportedly conceded that her termination was an error, influenced by board members Ricardo Schaefer and Andrew John McCormack. He extended an invitation for her to return, but negotiations stalled due to Kuda’s refusal to meet her settlement demands and its delay in responding to her “Data Subject Access” request.

Subsequently, the company issued a formal redundancy consultation letter, weeks after the initial dismissal, according to the filing. In the ensuing months, Hewat alleges Kuda intensified its retaliatory actions by suspending her salary, terminating her health insurance coverage, and withholding her accrued holiday pay.

Unable to endure the adverse work environment, Hewat resigned in April 2024, citing constructive dismissal.

The former CPO’s legal submission outlines the financial hardship caused by Kuda’s refusal to remit her outstanding wages.

Hewat is now seeking redress for unfair dismissal, gender discrimination, emotional suffering, and Kuda’s alleged failure to adhere to proper workplace grievance procedures. She is also requesting reimbursement for unpaid holiday pay and medical costs.

This legal challenge places Kuda, a company that has secured substantial venture capital, including a $55 million Series B funding round in 2021 from investors such as Valar Ventures and Target Global, under intense scrutiny. This occurs at a time when African companies are facing heightened pressure from investors and regulators to enhance governance and corporate accountability, a trend initiated by workplace conduct allegations at Flutterwave, Africa’s most highly valued startup, in 2022.

The situation is being closely monitored by investors and the wider technology community, potentially impacting the company’s reputation and its capacity to attract skilled personnel. Ogundeyi and the leadership team may also encounter increased scrutiny regarding their treatment of female staff.

This incident serves as a warning to other technology companies, highlighting how rapid expansion can sometimes mask underlying operational deficiencies. Kuda’s handling of this legal dispute will likely determine its future course, both in terms of employee relations and its position within the Nigerian and broader fintech landscapes.

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