Esaylo was indeed cloistered, at least for a little bit, and it all happened when he was pre transition. At some point after Vari dropped out of studying law, he left to go attend to cavern duties full time and being cloistered which resulted in a long, emotional goodbye between them. It was where Varita talking about how arbitrary and wrong Alternian law is really started to rub off on Esaylo as he began to notice a lot of wrong within the caverns and his own caste's purpose such as the trials, the fact that grubs are left at such a young age, how some lusii are Really not cut out for raising grubs and probably shouldn't raise them, etc. He tried to argue against these in the hopes of easing everything and improvement but nothing changed and he eventually got expelled for the insubordination.
As for consequences, well... this DOES eventually lead him to his death from being killed by essentially his sister figure and childhood friend Lydiya but Esaylo does revive as a rainbow drinker.