'600 Employees Fired, No Notice, Just Gone': Sacked Zomato Workers Shred Food Delivery App

Zomato Layoff News: The reported layoffs at food delivery app Zomato have sparked outrage among the affected employees, many of whom have expressed frustration over the sudden and seemingly unjust nature of the decision. In posts shared across Reddit, several former workers detailed how they were let go “out of nowhere,” with no prior warning or formal announcement. 

Employees stated they were blindsided by the dismissals, with some claiming they were told they were flagged as "faulty" based on performance data, while others were given little to no notice before being asked to leave.

Employees From Gurugram and Hyderabad Most Affected

According to former and current employees, many of those affected by the layoffs were part of the ZAAP training program in Gurugram and Hyderabad. These workers claim that they were forced to resign abruptly, without any formal warning or announcement.

One current ZAAP employee described the dismissal process, stating that workers were informed via Slack by a senior manager.  "More than 500 employees have been fired from Gurgaon and Hyderabad offices," a former employee told Outlook Business .

Several workers, they added, had received two or three warning emails before their termination, while others were dismissed without any prior notice.

Zomato Sacks 600 Employees

For the unversed, Zomato has recently laid off around 600 employees from its customer service training initiative, the Zomato Associate Accelerator Program (ZAAP), as part of a broader strategy to streamline operations amid slowing growth in the food delivery sector.

The company’s shift towards automation and artificial intelligence, particularly through its in-house AI-powered customer support platform, Nugget, has drastically reduced the need for a large customer service team. 

What Led to The Mass Layoffs at Zomato 

The main driver behind these layoffs appears to be Zomato’s shift towards automation in customer service. The company has introduced Nugget, an in-house developed AI-powered platform designed to handle customer interactions. Since its launch, Nugget has been responsible for managing over 15 million monthly interactions across various Zomato platforms. Impressively, Nugget now handles 80% of customer queries autonomously, drastically reducing the need for a large customer service team.

This move aligns with broader industry trends where businesses are increasingly adopting AI and automation to cut costs and improve efficiency. For Zomato, Nugget’s capabilities have made the need for human agents less critical, particularly in customer support roles, leading to a reduction in workforce.  

Compensation and Employee Sentiments

Affected employees were reportedly offered a month’s salary as compensation, as per Moneycontrol. However, many believe that the layoffs were abrupt and unjust. One employee shared their experience, stating that when they were asked to leave, they were told to leave with a smile so that the news wouldn’t disturb other employees.

These events have raised concerns about how such decisions were communicated and the overall treatment of staff, especially considering the sudden nature of the layoffs. The morale of remaining employees has also been affected, with many fearing that more job cuts could be on the horizon as the company continues its shift toward AI-driven solutions.

The Bigger Picture

Zomato’s decision to reduce its customer service workforce is part of a wider trend in the tech and service industries, where companies are increasingly relying on automation to drive efficiency and reduce overhead costs.

While AI platforms like Nugget promise to improve customer service experiences by handling routine queries, the human element in customer service roles remains indispensable for more complex and nuanced issues.

For now, Zomato's move marks a pivotal moment in the ongoing transformation of the food delivery industry, as companies adapt to changing market conditions and technological advancements. The layoffs also raise important questions about the balance between technological progress and the well-being of the workforce.