With just about a month to go before thousands of laid off hotel workers become eligible to claim severance, hoteliers are moving to put measures in place to avoid a massive $300 million payout.
Chief Executive Officer of the Barbados Hotel and Tourism Association (BHTA) Senator Rudy Grant told journalists that representatives from his organisation would be meeting with the officials from Barbados Workers’ Union (BWU) on the matter tomorrow.
He pointed out that if all laid-off workers trigger the severance payment clause then hoteliers would be faced with having to pay out some $300 million, which they simply did not have.
“Of course, under the legislation, if businesses cannot pay then it is a requirement of Government, and I think all parties recognise that would be a significant burden to carry,” said Grant.
Some hotels started to lay off workers at the start of April. By mid-June, about the 11th week of layoff for some workers, Government changed the Severance Payment Act to allow for severance eligibility to kick in at 22 weeks instead of the traditional 13 weeks.
After 22 weeks, laid off workers have a month in which to apply for severance.
Grant said Friday’s discussions with the labour union will examine how best the hotel and hospitality industry could secure jobs and businesses as they hope for a constant rebuilding of the sector over the coming months.
“While the issue of severance is at the forefront, we are also looking to see how we could adjust the manner in which work is undertaken to try to safeguard the businesses and safeguard jobs.
“The reality is that we have a situation where there has been a significant decline in the industry. Airlift coming in now is about five per cent of what it was this time last year. You have a situation where occupancy has declined by 91 per cent. The occupancy is now in the vicinity of six per cent,” said Grant.
Painting the dim picture of why the hoteliers were simply not in a position to pay severance, Grant said “the average daily rate declined by 41 per cent and revenue has declined by 96 per cent”.
“So just looking at those figures you can see the significant magnitude, and the issue of severance is one where I think all of the parties – Government, the BHTA, the trade unions – would want to secure jobs, would want to ensure that there is not that magnitude of severance that has to be undertaken, and to secure businesses as well,” he explained.
BHTA officials were reluctant to disclose what options were being contemplated. However, Barbados TODAY understands that in addition to hotel owners providing some “support” for workers, further changes to the legislation and a rotation of staff members could be two of the options to be placed on the table.
Chairman of the BHTA Geoffrey Roach said they had examined what other jurisdictions have done in place of severance payments, and would see how best some of those measures could be implemented in Barbados.
“Once we get through that then we will have a better idea where we stand with regard to persons being severed or other programmes that could be implemented,” said Roach.
In relation to the overall performance of the tourism industry, the BHTA officials noted that only 15 of the 78 BHTA-member hotels have so far re-opened with another 40 expected to open by yearend.
However, with still very little certainty of increased airlift and the cruise industry at a standstill, Roach said the number of hotels to re-open could change.
“There are so many factors that could definitely impact the amount of air traffic in Barbados. This comes as no surprise as countries throughout the world grapple with COVID-19,” he said.
He said as industry operators depend a little more on locals for business, some members have reported that Barbadians are taking staycations, and are patronizing the location restaurants, some attractions and other operations that remain open.
In relation to cruise, he said given the “no sail order” in place until September 30, Barbados did not expect to see any pick up in that segment just yet, and therefore some operations could remain closed for some time.
“There is still no confirmed bookings on cruise arrivals for Barbados. Many of the attractions and other operations are closed and such businesses will likely remain closed or would have very limited activity until there is some reasonable level of cruise activity,” said Roach.
He promised that despite the harsh circumstances facing the industry, the BHTA would continue its marketing and planning, and its sensitization and training of members, while encouraging them to continue to provide necessary training for their workers.
Roach said tourism operators remained optimistic that measures being put in place would help the industry to bounce back better, adding that the BHTA was working closely with government and other stakeholders “to ensure that our journey through this recovery will be seamless as possible”.
(marlonmadden@barbadostoday.bb)
