Hotel Sector to Face a Significant Impact

The implications of the new Holiday Act requirements will impact significantly on the hotel sector according to the New Zealand Hotel Council CEO Mark Oldershaw. The new minimum four week’s paid leave for employees comes into effect on April 1 this year.

“Given that the hotel sector is extremely labour intensive this is going to be a major issue for all hotel General Managers” said Mr Oldershaw. “Inevitably the introduction of any new legislative requirements will impact on some sectors more than others. In this case those businesses that require a high labour content are in for some major cost increases. The hotel sector certainly is within this bracket”

Staff rosters are some what of an ‘art form’ at the best of times however with the new requirement to provide a minimum four weeks paid leave the rostering of staff becomes even more difficult. “Obviously our members want to be responsible employers and staff welfare will always be of paramount importance. Also of utmost importance is our service provision to our clients. All hotels will be doing their utmost to ensure that quality service continues and that any impact on staffing remains seamless from the prospective of guests” Mr Oldershaw said.

“It will be a difficult balancing act for some time I suspect. As well as the potential impact on direct staff costs I am envisaging cost increases from suppliers who will be looking to pass their staff cost increases on to consumers”

“There are only so many costs that an entity can bear themselves before they consider passing these on to consumers. Obviously I can not speak for individual hotels as each will have to make their own commercial decisions however I would not be surprised to see a general price increase across the board within the labour intensive industries” said Mr Oldershaw.

“In order for New Zealand to remain a premium tourism destination we need to see a continual reinvestment in the hotel sector. We need to at least keep pace with international developments and trends. For this to continue to happen we must ensure that New Zealand is an attractive market from an investors perspective. Economic returns need to be both competitive and sustainable. Legislative requirements such as those being introduced by the Holiday Act amendments will not necessarily be helping investor confidence. Collectively our members control assets with a capital value in excess of NZD2.5 billion dollars, generate annual revenue over NZD760 million dollars and employ nearly 9,000 full and part time staff.” said Mr Oldershaw.

ENDS

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