Coronavirus: OYO announces voluntary leaves for few employees with 25pc paycut, no job cuts in India
In an internal townhall with its employees, Rohit Kapoor, India CEO, OYO Hotels and Homes, announced that a certain number of employees in India will be opting for voluntary leaves with limited benefits, applicable May 4, 2020, post lockdown. Rohit also asked OYO India employees to accept a reduction of 25 percent in their fixed compensation effective in April to July 2020 payroll. The company, however, assured that there will be no job cuts in India.
A statement by the company said,
"In these uncertain and difficult times, continuing its fight against COVID-19, OYO, one of the world’s leading hotel chains, today announced the onset of voluntary leaves with limited benefits for a certain number of employees in India, effective May 4, 2020, while assuring that there will be no people actions in India during the extended lockdown period. The company also reiterated that the goal is to minimise job cuts due to COVID-19, around the world, as much as possible, despite a deep impact on the business."
Earlier this month, though OYO had announced furloughs and temporary leaves globally, the hotel chain confirmed no people actions in India until the lockdown.
Ritesh Agarwal, Founder and Group CEO, OYO Hotels and Homes, said,
“At this point in time, OYO is not doing any job cuts despite the economic pressures. Based on the advice of hundreds of OYOpreneurs I have been in touch with, the key priority is that we do everything possible to minimise job losses. We can keep job cuts at bay through a combination of lowered work weeks, pay cuts, temporary leave of absence until business recovers and other such measures. Our goal is to ensure long-term sustenance of our business, which is critical for the industry’s recovery as well.”
Here is an edited excerpt of the Townhall speech by Rohit Kapoor:
As of this morning, there are no COVID-19 positive cases in OYO India. But since it’s always better to be safe than sorry, please continue taking precautionary measures, ensure cleanliness and hygiene around you and follow safety protocols. Our teams are also ready and equipped to support any emergency situation, so please get in touch if you need any support against COVID.
I want to start by thanking all India team members for doing exemplary work and leading from the front. Despite the looming uncertainty and restrictions as a result of the COVID-19 crisis, our teams are making efforts to help OYO emerge from this pandemic as a better and stronger organisation. As of today, several OYO hotels are ready to be used as quarantine centres.
We are actively supporting 8 state governments with quarantine or self-isolation facilities. We are in touch with more than 15 diplomatic missions or embassies to help stranded tourists get safe, clean and affordable accommodation.
We also have partnerships with leading brands like Apollo to support this cause. And, of course, we are supporting medical professionals and first responders with free stays across many markets including in India. It is evident, however, this crisis has made a deep impact on our business — you heard about this from Ritesh recently. Globally, it is the greatest challenge of our generation and nothing of this magnitude has been witnessed for over 100 years since the Spanish Flu epidemic of 1918.
OYO is taking all necessary actions 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. Our executive team around the world and I have voluntarily decided to take salary cuts of 25-50 percent to help OYO through this crisis.
Ritesh has publicly announced his decision to forgo his salary for the remaining year. It is also heartwarming to see many OYOpreneurs approach us with suggestions, which include taking voluntary pay cuts, temporary leaves, etc., to support the company during these testing times, and we are grateful to you all.
As an organisation, we have taken many steps to curb controllable costs, and are evaluating further options. In Ritesh’s video message, he had shared that the company will be placing a certain number of OYOpreneurs on furloughs or temporary leaves. This will ensure that these jobs are safe while we streamline business operations. While these efforts helped delay any potential impact on OYOpreneurs so far, they may not be enough, as the extent and projected length of the crisis is highly unpredictable.
So despite our best efforts, we have had to take a few more actions that will, unfortunately, impact our team members across the globe, including in India. Hence, 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 percent. This will be effective for April-July 2020 payroll.
All other benefits and terms of your contract will remain 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 is not less than Rs 5 lakh per annum. This ensures a large percentage of our colleagues at lower pay scales see no impact.
We had to also take the hard decision of placing some OYOpreneurs on a Leave With Limited Benefits
(LwLB). Those going on this leave will avail benefits such as
● Ex-gratia support
● Continuation of health insurance
● Parental insurance and a chance to renew it at negotiated rates in May
● Education allowance for those who have children
● In addition, in case there is an unforeseen medical emergency, we will support our colleagues
on LwLB beyond the insured amounts, if the need so arises
This leave with limited benefits will start from May 4, 2020 for four months until August 2020.
You will hear from more details from your leaders and HR partners. Our teams will also reach out to impacted colleagues individually with specific information and to answer their questions.
All these colleagues remain integral to the OYO family and we hope we will be in a position to welcome them back into full-time roles sooner rather than later. I understand that these are not easy developments for any of us; they have certainly not been an easy decision for the leadership team to make.
In many of my discussions, I was heartened to hear about the optimism about OYO shared by many of you, which continues to motivate me and all leaders to work day and night to strengthen the key capabilities of our business – supply, revenue and customer and partner operations.
In my working career, this is the fourth global business crisis I have seen – things always look bleak in the short run, but human endurance ultimately triumphs often sooner than we believe. 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. I want to again thank you for your commitment, passion for OYO and your contributions. My entire leadership team and I are always available to answer your questions. Please stay safe and take care of your health and that of your loved ones. Let us keep the faith as this, too, shall pass. Thank you.
Edited by Kanishk Singh