Indian food delivery company Zomato has laid off almost 600 customer support associates within a year of hiring them.
The decision is attributed to the company’s slowing growth in food delivery, losses in its quick commerce unit Blinkit and the adoption of AI to automate customer support tasks.
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The layoffs coincide with the recent launch of Nugget, Zomato’s in-house AI-powered customer support platform.
Developed over three years, Nugget is now handling 15 million monthly interactions and is capable of resolving up to 80% of customer queries without human intervention.
According to MoneyControl, the food delivery company initiated the Zomato associate accelerator programme (ZAAP) in 2024, hiring 1,500 people in customer support roles.
ZAAP promised employees opportunities to transition into company roles such as sales, operations, programme management, support, supply chain and category teams. However, many have found their contracts not renewed.
Employees in Gurugram and Hyderabad were asked to resign without a formal layoff announcement.
The affected workers were offered a month’s salary as compensation and were terminated with no notice period.
A current customer support associate stated: “A majority of employees hired under Zomato’s ZAAP programme last year have been let go over the last week or so without any clear explanation. This has taken place across their offices in Gurugram and Hyderabad. The atmosphere has become really tense.”
This is not the first major layoff at Zomato. The company previously let go of around 100 employees – close to 4% of its workforce – across product, tech, catalogue and marketing in December 2022.
In 2024, Zomato launched a safety response initiative aimed at automatically identifying incidents in which its delivery partners may be involved in accidents.
