The COVID-19 pandemic resultant lockdowns and regulations are affecting the hospitality industry since the start of the year. As other sectors are slowly recovering the conditions don’t seem to look up for this industry!
As a result, OYO has introduced a voluntary separation option and decided to extend the furlough (leave without pay) period of its Indian employees by six more months. This period was supposed to end this August.
Meanwhile, even with this extension of the furlough period and voluntary separation amid the COVID-19 crisis, two top-level executives have quit OYO Hotels & Homes.
Read on to find out more…
COVID-19 has Seriously Bruised the Hospitality Industry!
These two decisions- the extension of the furlough period and voluntary separation plan- by the company can be seen as ways to weather this economic crisis.
The hospitality industry worldwide is the most affected during the ongoing COVID-19 pandemic. These two decisions- the extension of the furlough period and voluntary separation plan- by the company can be seen as ways to weather this economic crisis.
In the April-July period, during the lockdown, OYO had resorted to 25% salary cuts and also had sent a few of their employees on leave without pay with limited benefits for four months. This has been extended by six more months.
Experts with knowledge in this space say the travel and hospitality sector has hardly achieved 10-15% business as compared to the pre-COVID-19 level.
What is the Voluntary Separation Plan by OYO?
OYO while announcing its decision of voluntary separation scheme for employees who wish to move on, the company said in a blog post, “We are offering a cash benefit equivalent to their notice pay basis last-drawn compensation in March 2020. This is beyond the 30% ex-gratia pay that was enabled for the months of May and June, respectively, for some upfront liquidity.”
The voluntary separation scheme of OYO India also offers restricted stock units to all its employees.
Opting for this scheme gives the employees a choice to cancel a small portion of their unvested restricted stock units (RSUs) of upto 25% and get additional cash benefit equal to 25% of their March 2020 drawn fixed salary.
The blog post read, “…we have created a set of options for OYOpreneurs on LwLB in India to make a decision that is best aligned with their long-term career goals and financial requirements. We are living in a world where everything is far from ideal and the solution that we are offering may still be sub-optimal.”
OYO said it will continue to provide healthcare coverage of the current corporate health insurance policy up to January 25, 2021.
It is also offering career transition support to these employees in partnership with ABC Consultants.
Major Management Shakeup At Oyo
On September 4, in an internal note, OYO said that Gaurav Ajmera, global head of revenue management, and Burhanuddin Pithawala, global head of marketing and growth, have quit.
According to ET reports, Chandan Agarwal, who was managing OYO’s cloud kitchen business, had also left earlier.
At the same time, Anuj Tejpal, previously a global business development leader, has been promoted as the global chief commercial officer head revenue (including OTA), marketing, and growth.
As part of its restructuring in India, OYO has also promoted Abhishek Bansal, previously leading revenue management for franchise business, to the chief revenue officer. It has also elevated Yatish Jain previously, a vice president, supply growth, franchise businesses, as head of marketing and growth, the note added.