Grab cuts headcount by 5% amid Covid-19 economic fallout

Technology company Grab is cutting about 360 jobs, or around 5 per cent of its headcount, amid the growing economic fallout from the Covid-19 pandemic.

Grab co-founder Anthony Tan announced the cuts yesterday during a company town hall meeting.

The restructuring comes a week after Singapore's largest private-hire operator decided to limit its performance-based commission rebate to 18,000 drivers.

Grab has also dropped a series of incentive schemes for drivers, including monthly trip target bonuses and birthday rewards.

Demand for ride-hailing services, which is Grab's main business, has fallen amid the pandemic.

In a note to employees that was posted on Grab's website, Mr Tan said the company had tried its best to avoid the cuts.

"We... had to accept that the difficult cuts we are making today are required, because millions depend on us for a living in this new normal."

Mr Tan said Grab had completed a review over the past few months and cut back on its discretionary spending.

But he added that the company needed to "become leaner as an organisation in order to tackle the challenges of the post-pandemic economy".

Mr Tan said Grab would be cutting "some non-core projects, consolidating functions for greater efficiency, and right-sizing teams to better match our changing business needs, given the external environment".

The company will focus on its delivery services by redeploying staff to meet the increased demand for deliveries, he added.

Mr Tan said: "We were able to save many jobs through this redeployment of resources and it helped limit the scope of the reduction exercise to just under 5 per cent.

"I assure you that this will be the last organisation-wide layoff this year, and I am confident as we execute against our refreshed plans to meet our targets, we will not have to go through this painful exercise again in the foreseeable future."

Grab will focus on its delivery services by redeploying staff to meet the increased demand for deliveries... Other focus areas for the company are its ride-hailing, payments and financial services.

Other focus areas for the company are its ride-hailing, payments and financial services, Mr Tan said.

"We will expand support for small businesses by enriching our merchant service offerings," he added.

Staff affected by the cuts were notified through e-mail yesterday.

Mr Tan said: "We want to make sure you can speak to your business manager and human resource representative personally, and have organised these discussions to take place as soon as possible over the next two days."

The company's severance package includes a payment of half a month for every six months of completed service, on top of another payment of 1.5 months of salary.

Staff who are expecting or whose spouse is expecting can encash their maternity or paternity leave, as of the last date of employment.

Those retrenched can also choose to keep their laptops to help them in their job hunt.

Grab had earlier cut the pay of its senior management by up to 20 per cent and encouraged staff to take voluntary no-pay leave as part of cost-cutting measures.

Co-founder Tan Hooi Ling said last month that Grab's overall revenue had been dragged down by its core ride-hailing business since the pandemic began.

The home-grown start-up was preparing for a "potentially long winter" and taking cost-cutting measures, she said.

The uptick in its food delivery business, as most Singaporeans stayed home to work, was not enough to make up for the revenue fall, Reuters reported.