Swiggy said that it started the exercise of realigning resources in May to create capacity in higher potential areas with the “optimism of the business” attaining pre-covid levels in the near-term.
Food delivery startup Swiggy has further fired 350 employees in the second round of layoffs as the business is yet to recover substantially from the Covid impact, a source aware of the development told Financial Express Online. Swiggy had last laid off 1,100 employees in May across grades and functions to ease cost pressure amid the Covid pandemic, which hit the food and hospitality segment severely, leading to multiple restaurants shutting down and order volume plunging to negligible levels for online food delivery segment.
Confirming the development to Financial Express Online, Swiggy said that it started the exercise of realigning resources in May to create capacity in higher potential areas with the “optimism of the business” attaining pre-covid levels in the near-term. However, since the industry managed to recover to only around 50 per cent of its peak, “we have to, unfortunately, go ahead with this final realignment exercise, which will result in the net loss of 350 jobs,” a company spokesperson told Financial Express Online in a statement. Nonetheless, Swiggy has no plans for “any further restructuring”.
Post first round of layoffs, Swiggy shifted focus to grocery vertical and shut or scaled-down its cloud kitchen business to fight Covid battle. “We have scaled up our grocery delivery and Swiggy Genie across cities, partnered with authorities to support benevolent causes, raised funds for our delivery partners, and introduced initiatives like Jumpstart to assist our restaurant partners,” the spokesperson said. Swiggy had added 125 cities to its network of grocery and essential goods delivery in April and also revamped its pick-and-drop service Swiggy Go as ‘Genie’ to deliver essentials like medicines in more than 15 cities. However, the situation has failed to improve for Swiggy and online food delivery market at large.
The benefits for outgoing employees will remain the same from the first set of layoffs. This included a minimum of three-to-eight months of salary based on tenure (includes an extra month of ex-gratia for every year served in addition to their notice period pay) and accelerated vesting of ESOPs. Moreover, an extension of accident and term insurance and health insurance for them and families till December this year, learning support for technical and professional skill development, job placement and counseling support, and ownership of their laptop will be available to the affected employees.
Swiggy’s rival Zomato had also announced a 13 per cent workforce (around 500 employees) layoff in May. The company had launched the grocery business Zomato Market to sustain Covid impact and leverage its last-mile logistics strength. However, it started to shut the new service in around two months in June to “spend a large proportion of our time making our food delivery service the safest, and the most loved one in town,” a company spokesperson had said in a statement.