Zomato Fires 13% Workforce, Cuts 50% Salary Of All Employees; 40% Of Restaurants Will Shut Down?
Covid-19 has harshly affected the world economy to severe levels. Many companies have started to adopt new ways, most of them cutting salaries, followed by immense lay-offs. People are scared, unemployed and have no idea of what the future holds.
To the ones who can see a clear picture of the market and economy of future are sure that it is not going to be beautiful.
We have fervently been covering all the news for you and have been keeping you readily up to date of the layoff and salary cuts throughout all sectors of economy.
Today, we bring Deepinder Goyal’s Zomato in the picture.
Zomato Lays off 13% workforce & Promises Salary Cuts
Indian foodtech unicorn Zomato has reportedly laid off 13% of its workforce. Zomato founder and CEO Deepinder Goyal claimed that despite building a more focused Zomato, he doesn’t anymore have enough work for all his employees.
Understandably, the Covid-19 pandemic has been harsher to the food sector, especially the restaurant and foodtech platforms, with everyone looking forward to stay at homes and consume only what they trust 100%.
Along with this, the CEO and founder also announced pay cuts for the entire organization. He claimed that June onwards, there will be a temporary reduction in pay for the entire organisation.
With lower cuts proposed for people with lower salaries, the company will move forward with higher cuts (up to 50%) for people with higher salaries. He has also added that many employees had already offered a voluntary pay cut of 100%.
This temporary reduction in pay will also be eligible for two times ESOP grants just like the earlier voluntary cuts.
Zomato Cutting Salaries Despite having Enough in Banks
The paycuts and the job cuts come at a time even when the founder admitted that the company is financially stable.
If we go according to what Goyal said, Zomato’s burn rate is significantly down from pre-COVID levels and that they “have a very generous amount of runway in the bank”.
Assuring that the Covid-19 has led the company to have a more focused approach in future, Goyal said that he anticipates only darker times ahead.
He wrote that their business has been severely affected by the COVID lockdowns. A large number of restaurants have already shut down permanently and they are aware that there’s more to come. He expects the number of restaurants to shrink by 25-40% in the next 6-12 months.
The company has also decided
to make partial or full work from home a permanent feature to cut down on real