After Uber, Indian Ride-Hailing Company Ola Cuts Down 1,400 Jobs

On Wednesday, Ola in India released an announcement of cutting down 1,400 jobs. As the coronavirus pandemic has affected seriously the firm's financial base, it has to reduce the expenses as much as possible when the lockdown is ongoing.

Ola's co-founder and chief executive Bhavish Aggarwal announced the issue to the team via email. Besides, he opened up that the revenue of the company had collapsed by 95% in late March and April when people had been forced to stay inside.

A spokesperson of Ola shared that not all employees were affected as cutting jobs happened in the Indian team and employees who work in food and mobility operations. Meanwhile, a separate branch of the company, Ola Electric, sees no changes in the layoffs.

One part of Bhavish Aggarwal's email reads:

"We had all hoped in the beginning that this would be a short-lived crisis and that its impact would be temporary. Over the past couple of months, all members of our extended leadership team have taken significant salary cuts to be able to help the organization delay tougher people decisions as we waited for the situation to evolve. But unfortunately, it’s not been a short crisis."

The email has been published on the ride-hailing firm's website. The chief executive continued:

"And the prognosis ahead for our business is very unclear and uncertain. It is going to take a long time for people to go out and about like before. With more companies preferring to have a large number of employees work from home, air travel limited to essential trips and vacations being put off for better times, the impact of this crisis is definitely going to be long-drawn for us. The world is not going to revert to the pre-COVID era anytime soon."

According to Aggarwal, cut-off employees will get three months of salary after the notice comes into effect. Moreover, they will receive insurance coverage for themselves and their parents, emotional and healthcare support until the end of 2020.

The Indian government informed a nationwide lockdown in late March that closed and prevented every public transportation services. Recently, New Delhi has loosened some restricted areas. Apart from Ola, Uber has also continued its services in several places across the country except for areas under a high concentration of COVID-19. Up to now, the ride-hailing company has been back to operate in over 160 Indian cities.

Post Uber, Ola is the next company in India to turn workforce reduction into enforcement. Earlier, Uber eliminated about 500 employees in the country since some of its initial wave of jobs went away earlier this month, as per the first report of an Indian news outlet. Since then, there is no obvious showoff of how the deadly pandemic has affected the Indian workforce in the firm.

Meanwhile, both startups of food delivery Zomato and Swiggy have been dealing with harsh destabilization when the coronavirus spread warns people of ordering online food services. After that, they have reduced around 2,600 jobs (Swiggy itself cuts 2,100 jobs).

Not stop then, travel firms such as MakeMyTrip or Oyo have also taken down a lot of jobs or cast many employees adrift when witnessing the company's revenues drop dramatically.

Ola also revealed a series of relief packages given in recent times to help the driver-partners. Several of the packages include tax allowance of lease rental for drivers and providing them with a few hundred dollars if they or their family members are infected with the coronavirus.

An insider said to a leading daily that Ola keeps hiring for new positions in R&D and other technical departments. In addition, Ola Electric has also created some fresh hires recently.