On Wednesday Oyo (Oralvel Stay Pvt.Ltd) has announced cuts salary and furloughed some of its staff in India, to save cash after its revenues plunged due of the covid-19 pandemic.
In an email to employees, Rohit Kapoor, chief executive officer of Oyo India and South Asia, said that the fixed compensation of the company’s India employees will reduce by 25 per cent. Employees who earn less than Rs 500,000 per annum will not be affected by the cuts.
Kapoor also said that ‘some’ Oyo employees will be furloughed for four months starting 4 May. ‘Those going on this leave will avail benefits such as continuation of medical insurance and parental insurance, school fee reimbursement and ex-gratia support in case of an unforseen medical emergency we will support beyond the insured amounts, if the need so arises,’ he said in the email.
‘Oyo is taking all necessary actions, like reduce controllable costs, voluntary salary cuts accepted by leaders, and more, to mitigate covid-19’s impact and ensure long-term success and sustenance of the business while ensuring there are no job cuts in India, despite the economic pressures,’ Kapoor said.
Oyo’s moves to cut costs are in line with similar measures taken by hospitality companies across the world, which are worst hit by the pandemic. The hospitality giant, with its wide international footprint in 80 countries is highly vulnerable to the crisis. For the year ended March 2019, Oyo, which is backed by SoftBank, Sequoia Capital, Lightspeed and others, reported a loss of about $335 million on revenues of $951 million.
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