Zomato-online food delivery and restaurant discovery platform, has fired 540 employees at the company’s head office in Gurugram across its customer, merchant and delivery partner support teams.
This the largest round of firing at the food aggregator, which is looking to reduce redundancies in back-end support roles.
The reason behind the move is an improved Zomato platform with Artificial Intelligence (AI)-driven bots and automation in resolving customer queries.
The company has extended 2-4 months of severance pay to employees laid off over the weekend.
The 10% of the company’s strength has been laid off by Zomato in company’s head office in Gurugram.
The company responded, “Today, we let go of 541 people (or 10% of Zomato’s strength) across these support teams — based out of our offices in Gurgaon.”
“Over the last few months, we have seen our technology products and platforms evolve and improve significantly. While the business has continued to grow consistently, this has led to an overall reduction in direct order-related support queries. We have dramatically improved the speed of service resolution, now only 7.5% of our orders need support (down from 15% in March).”
This, the company added, has led to certain redundancies across its customer, merchant and delivery partner support teams.
In 2019, layoffs at Zomato affected 600 people across customer, merchant and delivery partner support teams, the company spokesperson said.
“This year we have hired over 1,200 people in our non-delivery teams and another 400 off-rolls positions. We have also created jobs for hundreds of thousands of delivery partners. We are still hiring in our technology, product and data sciences teams,” the company added.
Zomato had earlier laid-off close to 300 employees in early 2015, or 10% of its staff, due to cost-cutting.
However, riders or delivery boys are mostly contract employees, who are not directly employed by companies.
The layoffs come at a time when Zomato, along with Swiggy, are struggling to negotiate fair and better terms and conditions with restaurant partners after the National Restaurant Association of India (NRAI) wrote to large food aggregators last month alleging unfair and anti-competitive practices followed by such companies, which they claim were hurting business for eateries.
Zomato and Swiggy are expected to look into some of the demands made by restaurants after marathon meetings between top executives of companies and the restaurant association.
Zomato was founded in 2008 as a restaurant discovery and review platform. It has expanded to 24 countries and services 10,000 cities globally. In India, it services 500 cities.
However, Zomato is determined on carrying on with its plans to make its Gold programme now available for delivery.