By NEIL HARTNELL
Tribune Business Editor
Bahamians were yesterday warned to brace for "more significant casualties" in the tourism industry as Baha Mar started terminating hundreds of workers.
Dionisio D'Aguilar, minister of tourism and aviation, told Tribune Business that The Bahamas "will suffer more victims" from the COVID-19 pandemic than less tourism-dependent nations as the Cable Beach mega resort yesterday informed the workers it is releasing via phone calls.
Baha Mar did not respond to Tribune Business questions seeking confirmation on how many staff will be terminated, or what percentage of its workforce that represents. However, Darrin Woods, the Bahamas Hotel, Catering and Allied Workers Union's (BHCAWU) president, said 328 workers had been released from its Melia Nassau Beach property alone.
While Baha Mar's other resorts are not unionised, Mr Woods said he had heard the number impacted by the terminations at those hotels "ranges from 1,200 to 1,300", although he was unable to confirm that.
Those numbers are in line with Tribune Business's exclusive revelation on June 15 that the $4.2bn mega resort, owned by Hong Kong-based Chow Tai Fook Enterprises, planned to terminate up to 20 percent of its staff - a figure that corresponded to around 1,100 to 1,200 workers.
While Baha Mar's move comes as little surprise given that it first flagged the lay-offs two weeks' ago, it still represented one half of yesterday's 'double whammy' for the Bahamian economy and tourism industry given that Atlantis, its mega resort rival, revealed its own re-opening date has been pushed back three weeks to July 30.
"It's very unfortunate in that more Bahamians have become victims of this COVID-19 pandemic," Mr D'Aguilar told Tribune Business. "I'm sure it's very disconcerting and troubling for the employees who have received their termination notices.
"I think while it's unfortunate it was probably expected given the swift decline in the tourism industry worldwide. This pandemic has affected hotels, airlines, excursion and tour providers, car rental companies... everybody."
Pointing out that LIAT, the airline that connects 15 Caribbean nations via inter-island flights, is to be liquidated due to COVID-19's catastrophic effects on its financial well-being, Mr D'Aguilar warned that The Bahamas needed to ready itself for potential corporate failures and mass redundancies in its tourism industry.
"There are going to be significant casualties from this pandemic, and especially in countries that are so dependent on tourism such as ours," he told Tribune Business.
"The United Nations' World Tourism Organisation (UNWTO) has noted that the tourism industry is pretty much at a standstill, and there are travel restrictions in 100 percent of tourism destinations and, in 72 percent of destinations, the borders are closed.
"They're expecting [global] tourism to be down in the second quarter by 60 percent to 78 percent. The Bahamas is obviously, being so tourism-dependent, going to suffer more casualties in an industry that is beginning to return in a real sense having been at a complete dead stop from the latter part of March 2020," Mr D'Aguilar added.
"I'm sure Baha Mar will not be the first. I'm sure more of the tourism sector will experience shocks like this until we get through this pandemic. We're not there at all yet given the rapid increase in cases in the US, which is our core market."
Mr Woods, the hotel union's president, yesterday said it was watching nervously to see whether Baha Mar's staff terminations cause "a domino effect" leading to more lay-offs throughout the Bahamian resort industry.
"I feel like a fighter in the 12th round who is just receiving low body shots," he told Tribune Business, revealing that "in excess of 300" workers had been released at Baha Mar's Melia Nassau Beach property.
"The numbers are around 328 or thereabouts," Mr Woods added, noting that the Melia had around 700 staff in total. This would mean the terminations at that property exceed the 20 percent threshold, with the lay-offs sparking a "mixed" reaction among those affected.
"Some think they could have waited a while, but management took the decision that the needed to do what they needed to do," Mr Woods added. "They're going to do renovations in short order, and of course there's COVID-19.
"With Baha Mar, Melia and the Hilton, it's now a wait and see whether there's a domino effect that moves throughout the industry. So far they've been the trend setters. The other hotels, including Sandals, have said they are opening later. We have to see what that represents.
"US cases continue to climb, with 40,000 a day being infected. That's going to cause a scare for the travelling public and those of us receiving them."
Baha Mar, in its statement yesterday, echoed Mr D'Aguilar by describing the hospitality and tourism industry as "the hardest hit" sector in COVID-19. Drawing on research by Oxford Economics and the STR data analytics provider, STR, it said the global sector is projected to lose 100.8m jobs in 2020.
With eight of 10 hotel beds forecast to be empty worldwide, and revenues down by 50 percent, Baha Mar said it had taken "the difficult, but necessary, decision to implement staffing reductions to adequately align with projected business levels" ahead of its planned October 2020 re-opening.
It confirmed that it was "communicating directly" with impacted staff, who would all receive due severance pay and benefits in accordance with their legal entitlements. The mega resort also pledged that it would bring back as many terminated employees "as possible once business returns to pre-COVID-19 levels".
That, though, is likely to be at least two years away. Baha Mar suggested that it acted now because the 13-week, or 90-day, deadline where employers have to determine whether to make furloughed employees fully redundant had arrived.
The Government had previously extended this until the end of July, but Baha Mar's statement said: "On June 29, as the 90-day period ended, it was necessary for us to take the incredibly difficult step of reducing our staff across Grand Hyatt, SLS, Rosewood, Melia, Casino and Baha Mar’s shared services.
"We are in the process of communicating directly with each of the associates affected by this decision, and we are here to help guide all impacted through the next steps. All affected associates will receive severance pay in accordance with the law."
It added: "All affected associates are eligible for rehire, and we look forward to bringing back as many associates as possible once business returns to pre-COVID-19 levels.
"With the ongoing construction and expanded resort offerings starting to launch in fall 2020, Baha Mar continues working hard to create additional opportunities for the Bahamian job market."
Baha Mar reiterated that it had ensured all employees received 40 percent of their base pay, in addition to National Insurance Board (NIB) benefits, plus maintained health and other insurance coverages for them since the property's March 25 shutdown.
Those workers remaining will receive 30 percent of their base pay for another 90 days and the continuation of insurance coverage.