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Swiggy follows Zomato, announces 14% layoffs as Covid-19 lockdown dampens business

Swiggy’s big moves come a few days after its arch-rival, Zomato, layoff its 13 per cent of its workforce.

SNS | New Delhi |

Food delivery platform Swiggy on Monday announced to lay off 1,100 employees, nearly 14 per cent of its workforce, over the next few days as the company continues to suffer due to the lockdown caused by the Covid-19 pandemic.

Sriharsha Majety, Co-founder and CEO, Swiggy said, “We, unfortunately, have to part ways with 1,100 of our employees spanning across grades and functions in the cities and head office over the next few days,” he said.

“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,” added Majety.

Swiggy’s big moves come a few days after its arch-rival, Zomato, layoff its 13 per cent of its workforce, along with salary cuts for the rest of the employees for at least the next six months starting from June, with higher cuts going up to 50 per cent for people in senior roles.

As per Swiggy, all impacted employees will receive at least three months of salary, irrespective of their notice period or tenure. If someone’s notice period is three months and they’ve spent five years with the company, they will get eight months of salary.

The company’s HR team will inform those being laid off in one-to-one video calls.

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 said in a detailed statement later.

“The core food delivery business has been severely impacted and will stay impacted over the short term,” said Swiggy.

The food delivery platform is also extending ESOP vesting for those impacted to the nearest quarter (including the months of notice period) and waive off the 1-year cliff for those who have not completed 1 year. It will also provide medical insurance cover for those impacted and nominated family members till December 31 2020.

“Additionally, we will also be providing insurance cover for their parents,” said the company.