As the coronavirus pandemic has hit the global economy hard, the hotel industry is badly impacted. One of the largest global hotel chains, Hyatt has officially announced that it will be laying off 1,300 of its employees as coronavirus severely impacted the hotel occupancy rate and in some cases, the numbers are even zero, which is an alarming sign for global star-hotels.
Citing the historic drop in travel demand and the expected slow pace of recovery, Hyatt has had to implement layoffs. This is the latest effort by the hotel corporation that franchises luxury and business hotels, resorts, and vacation properties to overcome the challenges of the Industry. The company has already reduced company-wide expenditures, extended salary reductions for the Senior Leadership Team and Board of Directors, and temporary work and/or pay reductions for all corporate colleagues.
Coronavirus impact: Hyatt lays off 1,300 employees
Hyatt, the renowned name in the hospitality industry, has taken the drastic measure to fulough its employees due to the impact led by coronavirus pandemic. The layoffs will commence June 1, 2020, as a part of the company's restructuring process. According to the company, around 1,300 of its employees from around the world will be handed the pink slip.
"COVID-19 has thrown our industry into unknown territory. While parting ways with our colleagues is excruciating, we must be sensitive to commercial realities so we can continue to fulfill our purpose of care over the long term – through this pandemic and for what lies beyond. Our goal is to emerge from this crisis with strength and ultimately position our business and our world-class teams for when the hospitality industry rebounds and when our guests and customers once again choose Hyatt," Mark Hoplamazian, President and CEO of Hyatt, said in a statement.
The furloughed employees who will be laid off next month will be receiving severance pay, outplacement services, and benefits commensurate with their years of service. In addition, Hyatt is extending support to those who may be in financial hardships by offering support through Hyatt Care Fund.
Other major chains to follow suit
With the impact of the economic slowdown in the hospitality industry, it is only a matter of time before other major chains start laying off their employees to address the current challenges. Other hotel chains are already making contingency plans with mass layoffs planned. Most of these layoffs are set to be in sales, F&B/culinary operations and on the front of house staff.