NEW DELHI: India’s biggest hospitality chain OYO Rooms is laying off over a thousand people from its workforce in China and India as part of a restructuring exercise. Nearly 1200 of OYO’s headcount in India will be impacted by the move, agencies reported.
The CEO of OYO Rooms, Ritesh Agarwal, has written an internal mail to colleagues admitting that the decision has not been easy and that the hotel chain will help outgoing employees look for career alternatives.
“This has not been an easy decision for us. We are doing everything we can to ensure that our outgoing colleagues receive as much assistance and support as possible through this transition. Every Oyopreneur is important to Oyo and ensuring their well-being both during and after their tenure is our number one priority. I want to thank them for their efforts and apologize for the impact this is causing,” the 25-year-old Agarwal said in his letter.
Softbank backed OYO was the recipient of the largest funding by an Indian startup in 2019 of $1.5 billion. Agarwal pumped in $750million apart from leading investors such as Lightspeed Venture Partners and Sequoia India.
OYO, which is the second most valued startup of the country at $18 billion, also has plans of listing in stock exchanges in India and overseas where it has expanded rapidly. However, the OYO bubble seems to be bursting gradually especially when several small hotel associations in India, the US and China have accused the hotel chain of violating the codes of contract and duping the partnered hotels. Agarwal, against whom two FIRs were lodged by the hotel owners, dismissed the complaints as being without any substance.
OYO has also been accused of having a toxic working environment where employees are expected to meet unfair deadlines.
"There have been rumours of the sales department particularly being pressurized to meet unrealistic expectations as a result of which many have already quit," an ex-OYO employee told The New Indian Express wishing anonymity.
Meanwhile, Agarwal maintained in his letter that the strategic objectives of the company are sustainable growth, operational and customer excellence, profitability, and training and governance.
“And this means that, unfortunately, some roles at Oyo will become redundant as the company further drives tech-enabled synergy, enhanced efficiency and removes duplication of effort across businesses or geographies,” he added.