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Apparently there are some layoffs despite promises to the contrary. The CEO of social commerce company Meesho had told Avinash Kumar Mehta at a recent meeting that all staff should not worry about their jobs. The guarantee was short, he said.
“Suddenly yesterday the employees started receiving calls and management forced us to present our resignation on the same call. I only have one question for the CEO of Meesho: you don’t value your words, how will employees trust you? Mehta said in a post on LinkedIn.
Earlier this month, Meesho had fired about 150 executives in different roles, citing “cost-cutting” measures that surprised everyone at the company, according to the employees ET spoke to.
WhatsApp messages and communications from the team that ET has reviewed indicate that the company asked employees to send their resignation emails within minutes of giving them the news. “We were shocked because the company promised it had enough money to run for 20 months,” said another mid-level executive, requesting anonymity. Meesho did not respond to ET’s inquiries.
In the past four weeks, at least two dozen major companies have laid off employees and contract staff. They include Oyo, BlackBuck, BharatPe, Acko, Fab Hotels, Zolo Stays, Treebo, Udaan, and Homelane. Others like Bounce, Livspace, AgroStar, BookMyShow and Droom have cut wages, according to data shared by Big.Jobs. Salary cuts range from 15% to 50-70%. Some like 91Springboard and Grofers have put some of their employees on the bench.
The government has been constantly urging companies to refrain from layoffs and pay cuts as they face the economic crisis. ET spoke to seven new employees. Some have retained their jobs, some have cut their wages, and others have been fired.
Fear increased by limited social contact
A common thread in all companies is a high level of anxiety, fear of the unknown and pressure to overcome in a suboptimal market.
“It’s like running at a very steady pace and suddenly someone kicks you,” said a mid-level employee at a transportation company who continues to work there, but is skeptical about his long-term prospects. Fear has been increased by limited social contact due to the isolation of working from home, they say.
Take the example of a senior BharatPe executive who recently lost his job. “It’s not just about the money,” said the 37-year-old executive. “These incidents shake his confidence, his career planning, and force him to make suboptimal decisions for himself,” he told ET, wanting to keep his identity confidential.
Those who have clung to their jobs also highlighted fears that market conditions will change for the worse and will hurt their career prospects, if not immediately, in the coming months.
“I took a cut in pay over the next three months (not optional), but does that guarantee my job is safe? No, ”said a senior executive at an advanced-stage consumer internet company. “The next two quarters will also be a disaster, and no one can predict when it will improve. This also affects the morale of the team below me. There is no security. ”
More jobs at risk
On Thursday, ET reported that new tech companies are likely to cut hundreds of more jobs in the next six to eight months, with the retail, hotel, travel, mobility and financial services sectors being hit hardest.
The founders indicated that their imperative is largely to keep cash for the next 20 months at least, and that will mean making tough decisions. A large number of these entrepreneurs are also young CEOs who may not have seen the collapse of dot com or any equivalent scenario with which they can draw parallels.
Undoubtedly, the push to cut salary bills has been underway for the past six months, with startups only selectively replacing those who have quit, promoting internally, freezing new hiring plans, and cutting staff.
Last year, Ola reduced the number of people by 8% and Paytm by 7%. Zomato laid off more than 500 executives, about 10% of its overall strength, while Rivigo laid off 70-100 employees and Quikr handed out pink sheets to more than 1,000.
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