Food delivery company Glovo has laid off 250 employees, about 6% of its global workforce.
Glovo attributed this to the macroeconomic situation affecting the world’s market and economic well-being today.
Per Reuters, Oscar Pierre, the Chief Executive Officer of Glovo said the move will mainly affect the company’s Barcelona offices – but the impact is still hard on its African offices, the difference being a 60 to 40%.
“The layoff decision largely impacts the company’s headquarters in Barcelona in areas such as business support functions, recruitment and data.”
It was further revealed that couriers, pickers and front-line employees are safe and would not be affected by the layoff. Glovo’s rapid growth since launch in 2015 had been impacted by operational inefficiencies according to Pierre and led to decreased demand in the fourth quarter showing external factors were affecting the delivery industry’s performance.
Emphasizing that the company’s vision and strategy remain the same, the CEO said the current macroeconomic situation, with rising interest rates and inflation, lowers the purchasing power of consumers, and some choose to order less often.
Less than a week ago, Glovo was fined close to €57 million (~$62 million) for breaching local labour laws by falsely classifying 7,800+ of its delivery couriers in Madrid as self-employed.
Reports revealed that the penalty was broken down into a €32.9 million fine for breaking labour laws; €19 million in unpaid social security contributions for the riders it had falsely claimed as self-employed; and €5.2 million for visa violations as the inspectors found Glovo to be employing a number of foreigners without a work permit.
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