Dunzo, a troubled quick commerce major, has reportedly once again delayed the payment of salaries to its employees, extending the deferral by another month.
According to an internal email viewed by Moneycontrol, the startup has informed its employees that their pending payments will be transferred by the conclusion of the first week in October. Initially, the company had communicated to its employees that their salaries for June and July would be settled by September.
According to the report, the company has also committed to providing an annual interest rate of 12% on outstanding dues.
Read More: Dunzo commits to pay 12% annual interest on withheld salaries amid financial challenges
“Please note that pending salaries for the months of June and July, due to be paid on September 4th, will be paid in the first week of October. You will receive the salary dues along with a 12 percent p.a. interest, which will now be calculated for an additional month,” said the email.
Expressing regret for the delay, the company stated that its foremost focus is to process pending compensation at the earliest convenience. Dunzo further emphasized its dedication to resolving outstanding payments and expressed confidence in avoiding any future delays.
This marks the third significant instance in which the quick commerce startup has postponed the disbursement of employee salaries. Before the September 4th deadline, Dunzo had also failed to meet the July 20th target it had set for resolving the outstanding employee salary payments.
In July, it was reported that the startup supported by Reliance deferred salary payments for 500 employees, constituting half of its complete workforce, and established a maximum monthly salary limit of INR 75,000 per employee. As a dispute emerged, the company arranged a town hall meeting with its employees and assured them that their outstanding salaries would be settled by September 4.
Read More: Hyperlocal commerce player Dunzo defers salaries for some employees, cites cash-flow constraints
In the midst of a funding predicament and a wave of employee resignations, the startup initiated extensive workforce reductions, resulting in the termination of approximately 300 employees, which accounted for 30% of its entire staff.
Read More: Dunzo downsizes workforce by 30% to cut costs as it secures $75 million in convertible note funding
In the midst of these developments, the company is also contending with legal notifications from seven vendors due to outstanding dues exceeding INR 11 Crores. Additionally, it has initiated comprehensive cost-saving measures across various aspects, including the closure of a majority of its dark stores and a shift towards adopting a marketplace model.
Read More: Cash-strapped Dunzo faces legal notice from Facebook and Nilenso over unpaid dues
Also Read: Legal troubles mount for struggling Dunzo as companies seek payment resolution
Furthermore, the company has been actively seeking financial support from investors. Just this month, it was revealed that the troubled startup was engaged in advanced discussions to secure $100 million in its Series G funding round. This infusion would consist of a combination of equity and debt and is intended to come from current investors, among them Lightbox and Lightrock.
Read More: Dunzo navigates series G funding talks amid controversy, eyes $100 Million investment
