Oyo Fires Thousands Of Employees Under Leave Without Pay; Is India Impacted?
In April, 2020, Oyo Rooms had enforced leave without pay for thousands of employees in the US. Now, news is coming in that they will be fired permanently.
However, stock options are being provided.
Will Indian employees get impacted?
Oyo Rooms Fires Thousands Of Employees
After putting thousands of employees in the US under leave without pay since April, Oyo Rooms has decided to fire them.
Although business is picking up in the US, and they are reporting upto 30% occupancy rate, but still, the growth is very less, and expenses mounting.
Oyo Rooms is left without any option in the US.
This was revealed in a leaked memo by OYO Chief Operating Officer Abhinav Sinha, wherein he has mentioned that stock options will be provided, and they will be supported and helped to get new jobs.
The leaked memo by Abhinav Sinha states: “This means it is likely that we will have to part ways many ‘OYOprepenurs’ when this period of furlough ends. For all employees currently on furlough, OYO is providing each of you with a stock ownership opportunity; and retaining an outplacement assistance firm, whose services will be available to you immediately,”
With occupancy rates touching 30% in the US, this is indeed a dramatic step.
He said, “That said, US revenue is still 25 per cent below the Jan levels, which for a high growth geography does set us back significantly,”
Will Indian Employees Get Impacted?
In India, Oyo Rooms founder Ritesh Agarwal has assured that no employees will be fired, although some of them are placed under Leave Without Pay, and some employees have received pay cuts.
Oyo Rooms has more than 10,000 employees in India, and their decision not to fire any employee in India despite having 60% less business is indeed noteworthy.
Infact, Oyo Rooms is providing Rs 130 crore worth of ESOPs to all the employees wh are under Leave Without Pay, which is regarded as one of the biggest in India.
However, in India, they have terminated fixed income contracts with most of the hotels, and this can caused some widespread dissatisfaction.
We will keep you updated, as more details come in.