The curious case of Walmart India layoffs and whistleblower allegations reaches US headquarters

• Two weeks ago, American retail giant Walmart laid off 56 employees across levels — including eight senior-level executives.
  
• Over 36 Indian executives that were impacted by the move have now reached out to the US headquarters of the retailer quoting layoffs to be ‘unfair’ and not performance-based.
  
• Given that, a compliance team from the US office may visit India to conduct a thorough investigation on the development.
  
• The downsizing happened as the retailer saw little scope in adding physical stores in the country.

Two weeks ago, American retail giant Walmart laid off employees across levels— including those in the senior management — as it moves from physical stores to e-commerce business.

On Monday, over 36 Indian executives that were impacted by the move, reached out to the US headquarters of the retailer quoting layoffs to be ‘unfair’ and not performance-based.

“We have written to them individually as well as a group because the company went ahead with the firing process even after an assurance in December that there will not be any layoffs. Some had even threatened to be whistleblowers in recent real estate deals where due process was not followed,” ET reported citing three former executives.

Given that, a compliance team from the US office may visit India to conduct a thorough investigation on the development.

However, the retailer claims to have a strong ethical programme in place and the company will review allegations seriously.

“We are committed to growing in India, doing so in compliance with all applicable laws and in a way that benefits our associates, local businesses and the communities where we operate,” a Walmart spokesperson told ET.

Walmart had earlier confirmed that it has laid off 56 employees, including eight in the senior management — adding that the impacted employees shall be offered severance benefits and outplacement services.

The downsizing happened as the retailer sees little scope in adding physical stores in the country. It may put more weight behind Flipkart — which it bought for ₹1.13 lakh crore in 2018.

However, Walmart’s exit from physical stores coincides with Flipkart’s expansion to the food retail segment in India. Flipkart FarmerMart is aimed to sell local products online — directly to consumers. Yet another online-physical combination — Amazon and Future Retail too are bunching their strategies together as they prepare for an onslaught from India’s richest man — Mukesh Ambani, who is planning to merge Jio’s digital capabilities with his retail venture JioMart which recently marked its e-commerce debut.

Walmart entered wholesale business in India in 2007 with the Bharti Group. It currently runs 28 'Best Price' Modern Wholesale Stores — selling to small shopkeepers — across the country. The retail major has over 5,000 employees in India — including 600 based at its head office, Business Standard reported.

See also:
Walmart sheds brick and mortar weight as it plans to go online with Flipkart

Reliance’s e-commerce venture JioMart makes a silent debut, calls for pre-registrations

Amazon rushes to bring Kishore Biyani’s Future Group online, days after Mukesh Ambani’s JioMart launch