Nearly 5,000 Of Flipkart's Senior Staff Will Not Get An Annual Increment This Year: Report

However, bonus payouts and employee stock option allotments are on track as planned for the employees, according to the report

Nearly 5,000 senior staff of e-commerce major Flipkart will not receive an annual increment in salaries this year. According to a report by Moneycontrol on February 22, the company in an email to employees said that only 70 per cent of employees will get an annual increment. 

The email said that those who are at Grade 10 and above levels won't get any hikes. However, it added that bonus payouts and employee stock option allotments are on track as planned for the employees, the report said citing a person aware of the developments.

“Given the current macroeconomic situation, we want to be prudent in managing our resources while keeping our employees’ best interests in mind. In line with this, about 70 percent of our employee base will continue to get an increase in their compensation,” Flipkart said.

“Additionally, our stock option allocation and bonus exercise will continue as is for those who are eligible. We stay committed to enhancing value for all our employees through employee-centric policies, continued skilling and training programs, regular promotion cycles, wealth creation for ESOP holders, and enhanced benefits, including medical insurance,” it said.

Although the company's yearly appraisals are finished, the increments are scheduled to begin on April 1, the report said. 

It was reported earlier that Flipkart will buy back employee stock options worth about $700 million from employees. This is part of Flipkart separating full ownership PhonePe. According to people close to the developments, this massive payout for buyback employee stock options is expected in the next few months after the paperwork for the separation of Flipkart and PhonePe is completed, the report said. 

One of Walmart's Q4 highlights included its foreign business operating income dropping by 72 per cent in constant currency terms to $300 million, mostly as a result of the separation of Flipkart and PhonePe into independent businesses. The company’s executives in an earnings call earlier this week said that Flipkart's contribution margin is positive and growing and that it contributes significantly to Walmart's international e-commerce sales.

Tech behemoths like Amazon and Google have decided to let go of thousands of employees, in order to concentrate on profitability in recent months. As they struggle to cut expenses and restructure their operations in a challenging macro environment, unicorns including Byju's, Sharechat, Swiggy, Zomato, and others have together laid off thousands of personnel.