OYO Hotels and Homes is planning to increase the number of job cuts to 2000, that is, about 1500 more than what was planned earlier. The decision to lay off people comes amidst plans to make some of its processes more tech-enabled and at the same time save on manpower costs.
It is not just the underperforming employees who will be asked to leave. Media reports had earlier cited that employees who score a D will be asked to leave. Now, the Company is expected to terminate even those employees who score a moderate and satisfactory grade of B or C. The average salaries of most of these employees is in the range of 10-12 lakhs.
According to an OYO spokesperson, the Company will make its employees undergo a performance improvement programme, after which it may replace some candidates if they are found to be lagging in terms of performance.
The job cuts will reportedly affect the sales, supply and operations divisions amongst others.
The Softbank-backed hospitality company has been suffering increasing losses. This year, its net loss in March amounted to Rs 2,384 crore, which is six times more than what was reported last year.
Employee-related expenses have spiked too, along with operational expenses. That is why, OYO appears to be serious about shedding some load and automating some of its processes.
The Company was planning to go public by 2022, at a valuation of $18 billion, whereas its current valuation is about $5.32 billion.