After Zomato Cuts Over 500 Jobs, Swiggy Lays Off 1100 Employees, 13 % Of Its Workforce

The COVID-19 outbreak and the nationwide lockdown has taken a toll on the country's economy, irrespective of the industry. Many are facing an uncertain future and there have been massive job cuts across various sectors as companies try to stay afloat during the challenging times.

Online food delivery platform Swiggy has become the latest to join the big names that are laying off its employees due to the financial setback in the industry. Swiggy on Monday announced to lay off 1,100 employees spanning across grades and functions in the cities and head office over the next few days. This is almost 13.75 per cent of its about 8,000 workforce.

¡°The core food delivery business has been severely impacted and will stay impacted over the short term, but is expected to start growing again after that. We need to hence prepare to come out stronger on the other side by continuing to build on capabilities that will help us make the most of the opportunity when things are better again. While we are very fortunate to have raised capital just before Covid hit and have sufficient runway today, it is incredibly important to prepare for worse scenarios in the macro environment and make sure we are protected,¡± CEO Sriharsha Majety wrote in an email to the staff.

All impacted employees will receive at least three months of salary, irrespective of their notice period or tenure. "For every year they have spent with us, we will be offering an extra month of ex-gratia in addition to their notice period pay, working out to between 3-8 months of salary depending on the tenure," said Majety.

AFP

Swiggy said it is also going to scale down or shut down adjacent businesses that are either going to be highly volatile or will not be highly relevant for the next 18 months.

"The biggest impact here is on the Cloud kitchens business, with many unknowns about volumes through the year. Since the onset of Covid-19, we have already begun the process of shutting down our kitchen facilities temporarily or permanently, depending on their outlook and profitability profile," Majety told the employees.

AFP

The development comes just days after its rival, Gurugram-based Zomato announced to lay off nearly 13 per cent of its workforce, over 600 employees, along with salary cuts for the rest of the employees for at least the next six months starting June, with higher cuts going up to 50 per cent for people in senior roles.