Zomato Fires 500 Employees: Zomato has fired 500 employees from its Gurugram and Hyderabad facilities under the Associate Accelerator Program (ZAAP). The company is shifting to AI-driven automation in customer service, leading to this workforce reduction. Many affected employees claim they were dismissed without prior notice for unclear reasons. They also reported being told to “leave with a smile” to avoid disrupting workplace morale.
Sudden Terminations Without Formal Notice
Zomato forced employees in its ZAAP program to resign without an official termination notice. Originally designed to streamline customer interactions, ZAAP’s downsizing suggests a deeper shift toward AI-driven operations.
One of the sacked employees revealed that senior management abruptly logged him out of the system after notifying him in a message that “data found him faulty.” The company offered him two months’ salary as compensation but gave no prior notice. Others said the company dismissed them based on subjective assessments of customer interactions and occasional tardiness.
According to a former employee, “I was instructed to depart with a smile to prevent any disruptions to my colleagues.” There was no opportunity to appeal or provide an explanation.
Artificial intelligence is replacing human customer service.
After three years of development, Zomato’s most recent AI-powered initiative, “Nugget,” was officially launched. T The redundancies align with the development of this initiative. Nugget automates customer service by managing over 15 million monthly interactions across Zomato’s brands, including Hyperpure and Blinkit. The AI-driven system effectively resolves approximately 80% of customer enquiries without the need for human intervention, thereby significantly reducing its reliance on customer support executives.
AI-based employee performance assessments raise ethical concerns amid growing automation. Zomato’s AI assigns “karma scores” like “gold” or “iron,” reportedly influencing dismissals. While AI improves efficiency, critics argue its lack of context can lead to unfair evaluations and job losses.
Financial growth in the presence of workforce reduction
Despite the reductions, Zomato has undergone significant operational expansion. According to its annual report, the company’s workforce increased by 34% in FY24, from 6,173 employees in FY23 to 8,244. According to financial reports, Zomato’s consolidated net profit for Q3 FY25 was Rs 59 crore, a substantial 57% decrease from the Rs 138 crore reported in the same quarter of the previous year. Concerns about privacy and fairness have led to criticism of the ethics of AI-facilitated employee performance monitoring.
The company’s AI provides “karma scores,” like gold or iron, which played a key role in deciding layoffs, reports say.
AI critics say it can’t understand context, leading to bias and job loss, despite its productivity gains.
has experienced considerable operational growth. As per its annual report, the company’s employee base grew by 34% in FY24, from 6,173 in FY23 to 8,244. As per the financial reports, Zomato’s Q3 FY25 consolidated net profit stood at Rs 59 crore, a huge 57% fall from Rs 138 crore reported during the corresponding quarter of last year. Concurrently, operating revenue rose from Rs 3,288 crore to Rs 5,405 crore year over year. This sentence is unrelated to the previous one and should be removed or connected with relevant context.
The growing use of AI in business processes has led to debates about job security. The use of artificial intelligence (AI) by Zomato to manage customer service and assess employee performance has generated some ethical issues about transparency, objectivity, and the possibility of its effect on job prospects.
With AI shaping the direction of the future job market, it is essential that companies regulate the proportion of human intervention and automation such that employees receive unbiased decisions and job assurance. The experience at Zomato has left much of the population in wonder regarding the future of employment in AI-driven sectors, pointing toward the escalating conflict between technological advancements and their outcomes for the working populace. Source financialexpress
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