Post Zomato announcing the haphazard layoff, its prominent competitor, Swiggy has now taken an arduous decision for the firm as India steps into its 4th phase of lockdown. The COVID-19 nation-wide seal began with full force on 24th March 2020 and is currently at its peak, with intense economic downfall. Amidst all, Swiggy announced laying off 14% of its total workforce i.e 1100 employees spanning across grades and functions. As rightly stated by the food delivery app, “There is a high possibility of shutting down adjacent businesses that are volatile or irrelevant for over 18 months” 

The announcement came two days after Zomato decided to lay off over 600 employees that makeup 13% of their global employee count. The affected people will receive a 50 per cent salary up to six months or until they find a new job along with the promised health insurance and a few other benefits, as assured by Zomato. 

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Why did Swiggy take this decision?

Businesses are witnessing the economic collapse and bankruptcy due to the spread of the novel coronavirus. Firms are shutting due to no demand and shortage of raw materials. The economic stature is deteriorating at an unbelievable pace. Each industry is taking various steps to overcome & curb the on-going pandemic loss thus, Swiggy found its way through cutback. 

Co-founder and CEO Sriharsha Majety stated, 

“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”

Swiggy took ample precautions to ensure a stable livelihood for its laid-off staff. The company is trying its best to aid financial, health as well as emotional assistance to the employees. The HR department of the company will inform the employees about the layoffs and will consider all the problems to come up with adequate and responsible solutions to the same. 

Compensation to the Affected Employees

  • Affected employees will be offered with 3 months salary.  Moreover, one month salary proportional to each year of employment will also be served. If the employee has worked for 4 months with the company, they will receive a seven-month salary in total. 
  • If the employee moved out to a certain place to serve the company, the stay expenses will also be reimbursed in case they want to go back home.  
  • The aim is to at least provide a 3-8 month salary to all the affected employees of Swiggy’s workforce.
  • Career-related assistance to each one to help them during the distressing times of the global pandemic. 
  • Emotional assistance is also a priority to the company. Swiggy believes to get through the tough times stronger and will give all the required assistance to the distressed employees. 
  • The medical insurance cover for the troubled employees and their families extended to 31st December 2020. 

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The CEO of the company is deeply saddened by the current scenario and it was a disheartening decision to part ways under such unforeseen circumstances. 

Pointer for the unaffected employees

Swiggy built a standard Esop (Employee Stock Ownership Plan) policy for the employees. Esop was shifted to the nearest quarter including the months of the notice period. The plan no more exists for the employees who have not completed a year with the company. 

Insights of CEO Majety’s Plans

The Bengaluru based unicorn is trying best to keep the business afloat during difficult times. Mr. Majety expressed his concern over future prospective risks due to COVID-19. He plans to produce profitability with lower costs and small order volume. 

The biggest impact here is on the Cloud kitchen business, with many unknown volumes throughout 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 told the employees.

Read Also: The Coronavirus Outbreak Has Led To The Sudden Transition Of Online Teaching


The digital commerce of India is undergoing a challenging diversion. Hence, online food delivery organizations need to execute steps forward accordingly. Swiggy plans to invest in grocery delivery with patent food delivery. Although the building uncertainty due to novel coronavirus has left businesses in a perplexing condition.

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