MakeMyTrip is now the latest in a long list of companies to institute layoffs, with 350 employees being laid off. The travel industry and hospitality industry has been especially hard-hit, with uncertainty surrounding when business will resume.
In a letter to employees, MakeMyTrip co-founder and Group CEO Rajesh Magow and Executive Chairman Deep Kalra said that the impact of COVID-19 is going the be long drawn for the company.
â€śWe are living through extraordinary times which have impacted individuals, communities, businesses, countries and our world at a magnitude unknown before and there is no let-up in sight,â€ť they said.
The two top executives stated that they have analysed the impact of coronavirus closely and have looked at business recovery â€” which has made it clear that some lines of businesses are too affected and will take longer than others to recover.
â€śAs we revisited some of our strategic imperatives to be able to sustain our business in the long term, it is evident that the pandemic has changed the context and viability of some of our business lines in its current form. Keeping this in mind we have had to take this sad but inevitable decision of rightsizing our workforce in these businesses,â€ť they added.
Employees have been laid off effective from June 1, and will receive their salary for the notice period, will get insurance cover till the end of December or till they find another job, whichever is earlier. They can also encash their accrued leave, and the company will be helping with outplacement. Employees who have completed five years will also receive gratuity, people can retain their company laptops, and retain the right to exercise part of RSUs as applicable.
In the email, Kalra and Magow said that the staff rationalisation is mapped to their future business strategy, and â€śis in no way a reflection of the work done by people in these teamsâ€ť.
In April, both top executives said that they would be foregoing 100% of their salary from April, and the senior leadership was taking a 50% cut in pay.
MakeMyTrip is a market leader in the online travel bookings space, with 42% market share. In April 2019, the company had received Rs 103 crore from its holding company, and an additional Rs 34 crore in July 2019.
Other travel companies that have seen paycuts, furloughs and layoffs include OYO, Ixigo, Fab Hotels and Travel Triangle.