Zomato lays off 541 employees, blames it on technology

Zomato lays off 541 employees, blames it on technology
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New Delhi: Online restaurant guide and food ordering platform Zomato on Saturday laid off 541 employees across its customer, merchant and delivery partner support teams, within a month of firing around 60 workers.

The reason behind the move is an improved Zomato platform with Artificial Intelligence (AI)-driven bots and automation in resolving customer queries that has led to an overall reduction in direct order-related support queries, the company said in a statement.

Zomato has extended between two to four months' severance pay based on the employee's tenure, a company spokesperson told PTI.

"Today, we let go of 541 people, around 10 per cent of Zomato's strength, across these support teams," he said.

"Over the last few months, we have seen our technology products and platforms evolve and improve significantly. While the business has continued to grow consistently, this has led to an overall reduction in direct order-related support queries," according to a statement issued by Zomato.

Zomato has dramatically improved the speed of service resolution such that now only 7.5 per cent of its orders need support, down from 15 per cent in March, the statement said.

"There is no one intervention or optimisation that has led us here, but a series of technological and process advances that on one-end spurred the growth of our food delivery business and subsequently the 5X growth of our delivery partner fleet over the last year have also led to fewer support queries and certain redundancies within our support functions," it added.

The company, which is at the loggerheads with the National Restaurant Association of India (NRAI) over deep discounts in its fine-dining Gold programme, said it hired over 1,200 people across functions (excluding its last-mile delivery fleet) and another over 400 off-rolls positions, and is currently hiring in technology, product and data sciences teams.

The company is planning to introduce its Gold programme across multiple cities on its delivery platform.

The NRAI said on August 30 that there is an in-principle agreement between the association and the two major online delivery platforms, Zomato and Swiggy, to resolve the issues of the industry including deep discounts.

(With inputs from PTI and IANS)

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