Oyo India Extends Furlough Period by 6 More Months; Introduces the Voluntary Separation Program

• Hospitality startup Oyo is extending furloughs for some Indian employees by six more months.
• The company has also introduced a voluntary separation option for those employees who want to move on.
• Oyo had announced a 20% salary cut for all its employees in India for the April-July period, while some had to go for voluntary leave with limited benefits. 

Hospitality startup Oyo Hotels & Homes has decided to extend the furlough period of its Indian employees by six more months on the back of the continuing impact of the coronavirus pandemic still hurting the hospitality industry.

In a blog post, the company said it has introduced a voluntary separation option for those employees who want to move on.

In April Oyo furloughed some of its employees which was to end in August. The company also requested some of its employees to take salary cuts, with Ritesh himself foregoing his full compensation for the year and everyone else giving up some parts of their compensation.

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It said on Friday Indian employees affected by the furloughs could choose a voluntary separation or remain on leave with limited benefits until end-February 2021.

Under its voluntary separation plan, Oyo India has also granted restricted stock units to all its employees. Staff who opt for the voluntary separation program are being given a choice to cancel a small portion – to the tune of 25% – of their unvested restricted stock units or RSUs and get additional cash benefit equal to 25% of their March 2020 drawn fixed salary. 

"Impacted OYOpreneurs (the term OYO uses for its employees) can either choose to opt for the Voluntary Separation Program (VSP) or continue the LwLB period by another 6 months until February 28, 2021. While the choice is theirs to make, we request them to attend to the several important elements to the proposal, which will help them make an informed decision," the blog post read.

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Oyo, once among the world's largest hotel chains by room count, said a recovery in business was taking longer than expected following India's nationwide coronavirus lockdown that was largely lifted in June. The country is among the startup's biggest markets.

"Post-unlock, we started tracking to 30% of pre-COVID occupancy levels. A small but encouraging green shoot, it enabled us to prioritize our commitment of saving as many jobs as we could and call back some impacted colleagues in different teams and geographies, as limited opportunities opened up," the company said in its blog.

The hospitality sector has been one of the worst affected by the coronavirus outbreak, with global and domestic travel coming to a near-halt and picking up rather slowly. MakeMyTrip, TravelTriangle, Treebo, and FabHotels had also laid off some employees in the past.