3000 Oyo Employees Will Lose Jobs In India, China; Income Tax Officials Scan Oyo Headquarters?
This seems to be the biggest crisis Oyo Rooms has faced in recent times.
Under fire from investors to reduce losses, and increase profits, Oyo Rooms will fire another 1200 employees from India and China. This will, 3000 Oyo employees from India and China will lose their jobs.
At the same time, Chinese hotel partners are now protesting against Oyo Rooms, for not honoring their commitments, and breaking promises.
And at the same time, ironically, Income Tax Dept has started scanning Oyo’s tax return files at their headquarters.
What exactly is happening here?
Oyo Will Fire 1200 More Employees
Citing performance issues, Oyo Rooms will now fire 1200 more employees from India and China.
They have already fired some 600 employees in China, which is 5% of their total workforce, and 12% of their employees in India, which is 1200. While 12,000 employees have been hired by Oyo in China, in India, the total headcount is 10,000.
With a new round of layoffs, the total fired employees in Oyo Rooms will become 3000.
Performance issues have been cited as the primary reason for these job terminations, as intense restructuring is being done, across all business verticals, with focus on removing redundancy.
In our earlier reports, we have mentioned that sales and marketing related jobs are the ones which will be reduced first.
Interestingly, the fired employees have been prohibited from issuing statements regarding this firing, and Oyo hasn’t released any official statement as well.
Reports are also coming in, that Chinese hotel partners are protesting against Oyo Rooms offices, as their financial commitments are not being honoured, and promises are being broken. In India, Oyo Rooms is already facing a backlash, as thousands of hotels have severed ties with Oyo Rooms due to differences related to financial promises, and business ethics.
China-based Softbank is the biggest investor in Oyo Rooms. Their losses have increased to Rs 2384 crore, which is 6-times more compared to last fiscal year.
IT Dept. Scan Oyo Rooms Headquarters In Gurgaon
Meanwhile, at the same time, Income Tax officials visited Oyo Rooms headquarters in Gurgaon, and conducted an examination of documents.
As soon as Tax officials entered the offices, several employees were asked to leave.
Oyo has stated that this was a regular TDS Survey, and nothing extraordinary.
In a statement, Oyo Rooms said, “There is a routine TDS survey in progress in one of our offices. We are cooperating with the authorities, and are committed to engaging with all relevant stakeholders. OYO Hotels & Homes has actively worked in ensuring that the wider unorganised segment is organised, and part of the formal economy. We continue to support small asset owners by creating entrepreneurship opportunities and giving them access to technology and other resources,”
We will keep you updated, as more details come in.