“Not an offloading exercise,” budget hospitality startup OYO said on Wednesday, in response to news that OYO had offloaded 150 employees to research and consultancy firm KPMG, with an aim to expel an ancillary unit such as finance shared services.
A spokesperson for the Gurugram-based startup told TechCircle it was a standard practice of outsourcing and rebadging employees, to ensure job continuity for its teams as the employees were given a voluntary opportunity to move to KPMG without any loss in pay.
OYO said it wants to focus on its core operations, and outsource specialty functions.
“OYO’s core expertise lies in being a technology and revenue growth brand for owners and operators of small hotels and homes. OYO’s Financial Shared Services teams primarily worked on transaction processing covering payables and receivables management, travel & expenses, and other related routine financial operations… KPMG is an industry leader that has demonstrated deep domain knowledge in finance shared services and we have past experience of working with them on other financial services projects,” the spokesperson’s statement added.
KPMG declined TechCircle’s request for a comment on the matter.
OYO and KPMG undertook the transition between November and January, as per MoneyControl, which first reported the development on Monday.
The reported set of employees are part of a six-month commitment of employment at KPMG, the spokesperson said. The staffers may continue to remain on the KPMG’s payroll depending on the audit, tax and advisory services firm’s decision, afterwards.
OYO is currently partnered under a multi-year service engagement with KPMG for end-to-end delivery of finance shared services.
“In order to ensure a smooth transition of this function for OYO and job continuity for our employees, the existing FSS team has transitioned to KPMG payrolls in their current roles, as per KPMG’s standard employment contracts,” the spokesperson added.
Ritesh Agarwal-led OYO has been in the news since 2019 for multiple reasons, including large-scale layoffs across its global operations to cut costs in a race to become profitable in the future.