OYO Cuts 25% Salary Companywide, After Furloughs

Gurugram-based hospitality unicorn OYO Hotels and Homes has now asked its employees to “accept” 25% salary deduction as it looks to overcome the impact on revenue from the Covid-19 pandemic.It  will be effective for April-July 2020 payroll.

OYO has decided to put some employees on leave with limited benefits from May 4, 2020 to August 2020. The benefits would include medical insurance and parental insurance, school fee reimbursement, and ex gratia support.

The development comes amid reports that OYO has told its UK employees that more employees would be furloughed under the government’s job retention scheme. High earners are also being asked to take a temporary pay cut.

OYO group CEO Ritesh Agarwal had earlier asked employees to go on temporary leave and had offered to look after the medical and healthcare benefits of all the employees across all its regions.

Agarwal has also forgone his salary for the year and senior leadership have been asked to take a 25% from the salary. Other Senior Executives across the world have voluntarily contributed 25%-50% of their salary.

As OYO tries to cut employee costs, the company is offering support to its hotel partners. The startup claimed that it has waived off multiple charges which are paid by partner hotels from March onwards. A benefit of around INR 24 Cr has been offered to over 3000 OYO partners.

OYO has also partnered with multiple lending institutions including fintech startups, NBFCs, add private sector banks to facilitate adequate financing for hotel transformation, Capex and working capital requirements of hotel-partners.

A retention linked discount has also been launched for a few hotel partners. It ranges from 50% on base fees for April and May. For beyond April, OYO might offer an extended discount until June.