OLA cabs had announced the layoffs of 1400 employees from its total workforce. The laid-off employees received emails from CEO, Mr.Bhavish Agarwal on Wednesday morning
The e-mail says that all the people at OLA have expected this crisis to be a short-termed one but people, companies are still suffering due to this crisis. With this, the long term future of the company is unclear. It also said that this virus had its greatest effect on the cab/travel industry.
The CEO has mentioned that the overall revenues have fallen down by 95% in the last two months. With this, the company has taken a decision to downsize some operations. As of now, the layoffs are being done in the mobility business and soon it will also happen in Ola Foods and Ola Financial Services. The CEO also mentioned that, after this round of layoffs, there will not be any more layoffs.
The employees who are part of these layoffs will be informed in their one-on-one discussion with their HR on Saturday. As part of the severance package, the employees are going to receive three months of fixed salary, irrespective of the notice period. The employees who are will Ola for a long time will receive higher pay based on their tenure.
All the ESOP’s will be vested to the closest quarter, and for the employees who didn’t even spend 1 year at Ola, the ESOP’s will be vested for the time period they spend at the company. Ola is also planning to extend insurance and health benefits until December 31, 2020. The company is also planning to extend its outplacement support like allowing its employees to use the company laptops until some time.
CEO also said that the company is also conserving cash during this crisis, which it will look to invest in the future. The company also said to invest a lot in R&D to increase their contribution of innovation and engineering
Last year, Ola has restructured its business in November with a goal of profitability. During that time, around 5-7% of the employees are affected of the whole 4500 employees. Those layoffs are part of the plan of Ola to become public in the next 18-24 months
However, with the corona crisis, this seems to be a distant goal. In the month of March, the CEO has decided to not take the salary for the whole year. The company had also worked with the government to provide emergency medical travel.