E-Commerce Unicorn Meesho To Lay Off 251 Employees: Report

Meesho, which was among the first few new-age companies to cut jobs in a tough funding environment, had last year let go of 250 employees from its grocery arm

Meesho employees will receive full pay for their notice period and an additional one month, along with a tenure-based payment of 15 days’ pay for every completed year of service, rounded up to the nearest year. ( Image Source :Getty )

Meesho, a SoftBank-backed e-commerce unicorn, has announced its second round of lay off in just over a year which may lead to the termination of 251 employees, around 15 per cent of its total workforce, as reported by Moneycontrol on Friday. According to the report, in an email dated May 5, Vidit Aatrey, co-founder and CEO of Meesho, told the employees about the decision, citing a challenging macroeconomic environment.

The Bengaluru-based firm, which was among the first few new-age companies to cut jobs in a tough funding environment, had last year let go of 250 employees from its grocery arm, which was rebranded to Superstore from Farmiso. The latest round is however the first one at Meesho's marketplace model, its core business.

"As leaders, we made judgement errors in over-hiring ahead of the curve. At the same time, we could have run our organisation structure in a more effective and lean manner overall," Aatrey said. "Our spans and layers were inflated, and this could have unintended consequences on our speed to execute. While we are confident that Meesho business will stay strong, the economic reality is here to stay. We are now faced with the hard truth of aligning our people costs with the new projections for our business. We should have done better here," he added.

According to Monycontrol, the employees impacted by the recent decision will receive an email in the next 60 minutes, letting them know about the status of their employment with the company. Then, meeting links will be shared personally to facilitate one on one conversations between the staff members and their managers, according to the email. Outgoing workers will, however, have access to Gmail and Slack channels till Sunday evening.

"We have taken a difficult decision to part ways with 251 Meeshoites, constituting 15 per cent of the employee base, as we look to work with a leaner organisational structure to achieve sustained profitability," a spokesperson for Meesho confirmed.

As part of the package to outgoing employees, employees will receive full pay for their notice period and an additional one month, along with a tenure-based payment of 15 days’ pay for every completed year of service, rounded up to the nearest year, as per the email. The company said it will also extend family insurance coverage till March 31, 2024. And will relax ESOP vesting norms so the departing employees remain shareholders in the company.