Food delivery app Zomato has decided to lay off more than 13 per cent jobs as the company does not have enough work for all its employees.
Deepinder Goyal, co-founder and CEO of Zomato on Friday, in an email message said the company now does not see enough work for all its employees.
More than 500 employees of Zomato will now be jobless.
Zomoto was probably not prepared for COVID19 pandemic, and had acquired Uber Eats India in an all-stock transaction for $206 million in January this year.
“Multiple aspects of our business have changed dramatically over the last couple of months and many of these changes are expected to be permanent,” Goyal said.
He said, “While we continue to build a more focused Zomato, we do not foresee having enough work for all our employees. We owe all our colleagues a challenging work environment, but we won’t be able to offer that to 13 per cent of our workforce going forward.”
The employees will remain with Zomato at 50 per cent salary for the next six months, and the outplacement teams will help them to look for jobs elsewhere, Goel said.
The employees, who are now being layed-off, will get e-mails for a Zoom call with the leadership team within the next 24 hours, Goel said.
At present, Zomato has more than 4,000 across India, and with the job cut, the number may come down to 3,500.
From June, Zomato have salary cuts up to 50 per cent for people with higher salaries, and 25 to 30 per cent in the lower level.
“Our business has been severely affected by the COVID lockdowns. A large number of restaurants have already shut down permanently, and we know that this is just the tip of the iceberg. I expect the number of restaurants to shrink by 25-40 per cent over the next 6-12 months. What actually happens, for better or worse, is anybody’s guess,” Goyal said.
Goyal will soon address townhall of the company, and may allow its employees partial or full-time work from home in future.