Zomato To Let Go Of 13% Of Staff, Pay Cuts Of Up To 50% For Rest

Zomato said it will continue to be short of its salary reduction target despite the pay cuts
Zomato said it will continue to be short of its salary reduction target despite the pay cuts

Restaurant aggregator Zomato said on Friday that it will lay off around 13 per cent of its employees and announced pay cuts of up to 50 per cent across its workforce for six months starting June. The layoffs and temporary pay cuts at Zomato come at a time when the country is nearing the end of the third phase of the nationwide lockdown to curb the spread of the coronavirus (COVID-19) pandemic, which has pushed the economy into a standstill and forced many businesses to trim workforce.

In a note sent to Zomato employees early on Friday, founder and CEO Deepinder Goyal wrote: "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 around 13 per cent of our workforce going forward," the Zomato founder added.

Zomato co-founder and COO Gaurav Gupta and CEO-food delivery business Mohit Gupta will be in touch with the impacted staff through video calls over the next few days to "help find them jobs as soon as possible". Zomato will "financially and emotionally support them to the fullest possible extent", Mr Goyal said.

Those Zomato employees who are impacted by the layoffs will "get invites for a zoom call with the leadership team within the next 24 hours. These invites will be sent to you via email and Dingtalk", Mr Goyal said. "For everyone who is not impacted – an email from in the next 6 hours should tell you that your jobs are here to stay." 

Pay Cuts

Mr Goyal said that while lower cuts are being proposed for the company's staff with lower salaries, salary reduction of up to 50 per cent is for those with higher salaries. He also said that despite the pay cuts, the company will continue to be short of its salary reduction target.   

"So many people have volunteered for a 100 per cent pay cut for at least six months - that is something I wouldn't expect to happen at many other companies," he told employees. 

The pay cut will not apply to employees who have already taken a voluntary cut equal to or higher than the proposed temporary reduction, the Zomato CEO said.

He also said that Zomato employees who are out of work at the company will continue to get 50 per cent salary for the six-month period.

"During this time, outside of the handover period of 1-2 weeks, we expect these folks to spend 100 per cent of their time and energy towards looking for jobs outside of Zomato," he said in the letter addressed to staff.