Oyo Hotels and Homes on Wednesday announced that it will cut a 25 percent from the salaries of its employees for April-July period, while also placing some employees on leave with limited benefits for four months from May 4, notably the day after the termination of the lockdown in India.
Followed by which Ritesh Agarwal, the founder & CEO of OYO said that a significant number of employees across the world will be put on leave temporarily for a period of 60-90 days for the company revive from its losses amid the pandemic situation. OYO has witnessed a steep downfall 50 – 60 percent in revenues due to the pandemic.
“The economic impact brought by COVID-19 is dramatic and has impacted every industry… I cannot imagine any other industry that is worse affected [than] travel, tourism and hospitality,” said Agarwal
Rohit Kapoor, CEO, OYO Hotels & Homes, India & South Asia in an employee townhall on Wednesday affirmed that the company is taking appropriate actions to mitigate the COVID-19 impact and ensuring long-term success and sustainability of the business. He added that “there are no job cuts in India, despite the economic pressures.”
He also added that these efforts by OYO might not be enough to suppress the impact of the pandemic and the further impact of the crisis is unpredictable.
After the townhall, in a conversation with The Hindu, Kapoor said,
“Today, our company is taking a difficult but necessary step for India, whereby we are asking all OYOprenuers to accept a reduction in their fixed compensation by 25%.”
Adding to which he said, the measures will be effective from April-July 2020 payroll and all other benefits and terms of the contract will be remained unchanged.
“Also, note that this action will be planned in such a way that post the proposed pay cut, the fixed compensation for any employee will not be less than ₹5 lakh per annum. This ensures a large percentage of our colleagues at lower pay scales see no impact,”
Sharing his final thoughts, Kapoor said,
He added, “I am confident that with all the actions we are taking, we will be in a good shape to take on the opportunities that the post-COVID world will have to offer. OYO’s offerings are as relevant to millions of guests today as they were pre-COVID.”