MakeMyTrip lays off 350 employees due to COVID-19: Details here
What's the story
Following Ritesh Agarwal's OYO Rooms, India's largest travel aggregator MakeMyTrip has laid off 350 employees from its workforce. The decision from the company comes in the wake of the COVID-19 crisis, which has resulted in lockdowns as well as movement restrictions that have wrecked the entire travel and tourism industry in a matter of months. Here is more about MMT's decision.
Announcement
Letter from Founder Deep Kalra and CEO Rajesh Magow
In a letter to employees, MakeMyTrip founder Deep Kalra and CEO Rajesh Magow announced the layoff exercise affecting 350 full-time employees of the company. They said the pandemic has changed the context and viability of some of the company's business lines and has forced them "to take this sad but inevitable decision of rightsizing our workforce."
Reason
Staff rationalization mapped to future business strategy
Kalra and Magow emphasized in the letter that their staff rationalization move is directly mapped to the company's future business strategy. They clarified that the decision is not reflective of the work the affected employees did in their teams and they are "truly appreciative" of everything they have done over the years to make MMT the company it is today.
Benefits
Benefits to support affected employees during this crisis
The senior leaders of the company also promised full support to help the impacted employees go through this phase. To this end, the company will provide salaries as per the employees' notice periods, mediclaim coverage till the end of the year, gratuity, leave encashment, right to exercise a part of restricted stock units (RSUs) as applicable, option to retain company laptops, and outplacement support.
Details
International holidays among deeply hit business lines
The lines of business that have been affected include international holidays and related operations, a MakeMyTrip spokesperson told CNBC TV 18. Now, it remains to be seen how the company steers through this crisis, given that it is completely unclear when things will go back to being normal and foreign travel will become a way of life, as it was in the pre-COVID period.
Information
Other cost cutting measures also taken
Along with this layoff, MMT has also taken some other measures to cut costs and preserve cash. This includes Kalra and Magow taking 100% salary cut, leadership team taking 50% cut, and slashing variable costs like advertising, sales promotions, payment gateway costs, and office expenses.
Layoffs
Other companies have also laid off employees due to COVID-19
The spread of COVID-19 has hit many sectors beyond travel, which has pushed several Indian start-ups to either furlough or lay off thousands of employees from their workforce. So far, the companies that have downsized in some way include Ola, Uber, Swiggy, Zomato, BookMyShow, Reid & Taylor, OYO Rooms, Cure.fit, Udaan, Acko, and Fab Hotels.