OYO asks thousands of employees to go on leave as revenue decreases by over 60%

OYO has said to its thousands of employees to go on leave or furloughs for a period of up to three months as the company plans to dodge coronavirus’ impact on the revenue and occupancy of its hotel rooms.

Founder and CEO of OYO Ritesh Agarwal, in a video message uploaded on YouTube, said that the outbreak of coronavirus has severely impacted the business of travel and tourism industry globally. Since the outbreak, OYO’s occupancy rate and revenues have dropped by more than 50 to 60% and the company’s balance sheet has come under severe stress. Agarwal said that the company will look after the medical and healthcare benefits of all the employees across all its regions.

OYO has put a halt on all the capital expenditure (CapEx) activities. Agarwal said that all the non-essential travel has also been put on hold for the moment. He also brought the fact the impact has come just after OYO did a sizable restructuring of the company in January. Due to which, the company plans to do no or negligible layoffs for cost restructuring across the world. However, the company has reportedly laid off around 360 employees in the US recently.

Till now, less than 10 employees of OYO have tested positive for the coronavirus. Agarwal said that a few of them have already recovered in China, Brazil, and other South American countries.

Agarwal also focussed on OYO’s initiatives to tackle the outbreak and its impact. He said that the company has set up a global welfare fund towards the benefit and welfare of the employees at OYO properties. Agarwal has also forgone his salary for the year and senior leadership have been asked to take a 25% from the salary.