SoftBank-backed Oyo Hotels is in the process of handing out pink slips to thousands of employees in India and China. The homegrown firm is in the process of restructuring and trimming redundancy.
According to a report in Bloomberg, Oyo has let go of 5 per cent of its 12,000 employees in China due to non-performance. This amounts to around 600 employees in the Chinese unit. Meanwhile, in India, Oyo is dismissing 12 per cent of its 10,000 employees, which is around 1,200 workers. The company plans to shed another 1,200 employees in India over the next three to four months, stated the Bloomberg report.
In a statement, the Ritesh Agarwal-founded firm said, "We continue to be one of the best places to work for and one of the key reasons for this has been our ability to consistently evaluate, reward and recognize the performance of individuals in a meritocratic manner, and enable them to improve their performance."
Masayoshi Son's SoftBank has been struggling with the aftermath of the WeWork debacle and the slumping share prices at Slack and Uber. The investors have called for greater financial discipline in its portfolio companies. This has, the report adds, spurred job cuts in smaller outfits as well as restructuring in the bigger firms.
Hotel owners in China have been protesting outside its offices accusing the firm of violating contractual agreements. Oyo had said that it would enhance communications with hotel owners and develop owner loyalty this year. The company said that it would ensure that the interests and needs of the hotels as well as of the company are equally taken into account.
SoftBank's Vision Fund has invested around $1.5 billion in Oyo, taking its valuation to $10 billion. Airbnb, Sequoia Capital and Lightspeed Venture Partners are some of the company's investors. While Oyo has grown at a fast pace, its reputation has taken a beating due to customer complaints and hotel owners' allegations of poor and unfair treatment by the company.
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