By NEIL HARTNELL
Tribune Business Editor
The hotel union’s president yesterday estimated up to 15,000 resort workers and their families have been hit by the wave of industry closures, and said: “I’ve never seen it this bad in 30 years.”
Darrin Woods, the Bahamas Hotel, Catering and Allied Workers Union (BHCAWU) chief, told Tribune Business that this nation’s tourism-based economy had “come to a screeching halt” amid a pandemic that has seen countries close their borders to international travel.
Speaking after a weekend that saw Atlantis “temporarily” lay-off staff across all departments for four weeks, Baha Mar do similar for all “non-essential staff” and Sandals confirm the closure of its two Bahamian resorts from month’s end until May 15, the union president argued: “The only silver lining is that it can’t get any worse than this.”
Dionisio D’Aguilar, minister of tourism and aviation, told this newspaper that its projection that direct and associated tourism lay-offs will take the national Bahamian unemployment rate to between 25 percent to 30 percent was “probably right”.
That means for the short-term, at least, that close to one out of every three Bahamians looking for work will be unable to find it, while many others will be struggling to get by on reduced hours and slashed income. Mr D’Aguilar described the COVID-19 pandemic as a “cataclysmic event” for both The Bahamas and the world, with the greatest uncertainty involving how long it will last.
Tribune Business understands that one option being explored by hotel union to assist its members, and non-unionised hotel workers, is whether the industry’s Health and Welfare Fund and Employee Assistance Fund could provide some financial support.
Mr Woods declined to comment on this, but this newspaper was told that obtaining assistance from these funds is “something that cannot happen overnight” due to how they are governed and the purpose for which they were created.
The Health and Welfare Fund is specifically to assist hotel workers who have been made redundant, not those who - in this particular instance - have been temporarily furloughed or laid-off. The Employee Assistance Fund, too, was not established for that purpose, having been created to provide fire and medical assistance.
Tribune Business understands that the operation of both funds is strictly governed by trust documents, and it would require agreement among the trustees to use the monies for an alternative purpose such as responding to the fall-out from COVID-19. All this takes time. The hotel industry pension funds are also designed strictly for retirement purposes only, meaning they cannot be used to help.
“I have never seen it this bad,” Mr Woods told Tribune Business of the mass resort closures and temporary lay-offs. “I was in the industry when we had the Gulf War in 1991. I was working with the union in 2001, and I was working for the union in 2008. Never has the entire industry, and I would go so far as to say the world, been affected by a pandemic in this manner.
“It has brought the entire Bahamian economy to a screeching halt. Nothing can happen in the tourism industry because there are no guests coming, and those that are here are trying to get home. Businesses and industries connected to the tourism industry are effectively shut down. You’ve got at least 13,000 to 15,000 in the hospitality industry by itself, and others, that are affected.”
Atlantis, which employs around 8,000 persons, yesterday said no department had been spared the “temporary lay-offs” announced at the weekend. A spokesperson said: “The lay-offs affect every department. As business levels begin to increase team members will be called back to work. We have no further comments.”
Karen Carey, Atlantis’ senior vice-president of human resources, in a March 21, 2020, letter, said: “Due to the recent announcement by the Government of the Commonwealth of The Bahamas and the economic impact of COVID-19, some of our operations have been further impacted.
“As a result of this, your position will be affected. Commencing today, you will be temporarily laid off for a period of four weeks. We understand the bearing this will have on you during this period, and you are assured of our commitment to support you as we navigate through these uncertain times.”
Baha Mar, meanwhile, appeared to offer impacted associates more than Atlantis. Graeme Davis, the Cable Beach resort’s president, said it would pay full-time employees 40 percent of their base pay for 90 days from March 26, 2020.
He added that Baha Mar, which employs more than 5,000 staff, would also continue to pay staff insurance premiums on health, life, accidental death and dismemberment coverage. All Baha Mar employees were urged to contact the National Insurance Board (NIB) to determine their eligibility for the new $10m temporary unemployment benefit.
“As the global community grapples with the effects of the COVID-19 pandemic, the safety and well-being of our staff, partners, guests and the Bahamian citizens are our top priority and, as such, we have made the difficult decision to temporarily suspend operations until further notice beginning March 25 at 3pm. At which time we will undergo a temporary lay-off of all non-essential staff,” Mr Davis wrote.
“The weeks ahead are sure to be trying, but we look forward with hope and anticipation to a time when we will welcome our guests and associates back to our property for the spectacular experiences we are known for around the world.”
Robert Sands, Baha Mar’s senior vice-president of external and government affairs, yesterday declined to say much beyond the contents of Mr Davies’ note to staff. “Our staff numbers are sizeable, very sizeable, and everything’s a work in motion because the shutdown is not until March 25 at 3pm,” he said.
The COVID-19 pandemic has wiped out the Easter holiday that traditionally signals the peak winter tourism season’s end, which is when hotels traditionally make the bulk of their profits that carry them through the rest of the year.
With peak season profits dramatically reduced, and no guests meaning no income or need for hotels, owners of major Bahamas-based resorts have reacted immediately to stem the financial bleeding and stave off their own woes by drastically cutting costs - labour expenses being one of the biggest items.
With the COVID-19 crisis still playing out across the world, the global travel and tourism industry - including The Bahamas - could be feeling the shutdown’s effects for some months to come, with the Thanksgiving and Christmas season looking like the earliest when normalcy will return.
“We don’t know how long this will be, and how impactful this will be, at this time,” Mr Sands added. “It’s still very early. I don’t even want to begin to make any assessments at this point in time. Nobody knows. The focus of all hotels right now is the safety of guests, staff and associates, and then we will pay attention to the other hurricane when we ramp up and get back to work.”
Meanwhile, Gordon ‘Butch’ Stewart’, Sandals Resorts International’s chairman, in a message to potential guests confirmed the closure of all the chain’s Caribbean resorts - including Royal Bahamian on New Providence and Emerald Bay in Exuma - from month’s end to May 15. The move is likely to have a major negative impact on Exuma, in particular.
“Never could we have imagined the impact the current global health crisis would have on the world. In these unprecedented times, and now more than ever, the safety and health of our valued guests is of paramount importance,” Mr Stewart wrote.
“Recent global travel warnings, coupled with airline carrier cancellations, have compelled us to make the difficult decision to close all Sandals and Beaches Resorts from the period of March 30 to May 15, 2020. Therefore, will not be able to accept new arrivals as of March 23, 2020.”
He added: “The Caribbean is resilient. We have always come back better, stronger and more passionate than ever. We promise this time will be no exception.
“We will take this time to make further enhancements to our resorts so that we will continue to surpass your expectations and provide you with the luxury-included vacation you so well deserve.”
The two Sandals resorts closures, as well as that of the Melia, will on a conservative estimate likely add close to 1,000 further hotel workers to those impacted at Atlantis and Baha Mar, meaning Mr Woods’ 13,000 to 15,000 estimate is not out of line.
The hotel union president added that it was “only a matter of time” before other properties, such as the British Colonial Hilton and Lyford Cay Club, followed suite. “They all rely on the same ingredient: Travelling guests,” he said. “That’s the thread that goes through the entire industry.
“It’s rough. I’m praying every day that it gets a little bit better, and we can execute on what needs to be done to mitigate the impact.... The only silver lining is that it can’t generally get any worse. It can only get better.”
Mr Woods again urged a “tripartite solution” between government, hotel employer and union to avoid NIB becoming overburdened by resort worker unemployment benefit claimants.
Mr D’Aguilar, meanwhile, conceded that the Bahamian resort industry faced a long, slow recovery once the COVID-19 pandemic had passed due to the time it would take for travel industry confidence to be restored.
“All marketing has ceased, all promotion has ceased, until our core markets in the US and Canada work through this crisis and we get on the other side of this cataclysmic event,” the minister told Tribune Business. “It really makes no sense to do anything other than develop strategies in-house and prepare for when we want to turn the marketing back on.
“All we can do is prepare for that event. This event affecting the entire planet is a first, and no one knows how eventually this plays out. Your guess is as good as mine. We just don’t know how deep and how long the curve is going to be in terms of COVID-19 cases in the US.”
Acknowledging that hotels would have to “ramp back up” and re-hire staff once the pandemic was over, Mr D’Aguilar agreed with Tribune Business’s assessment that the national unemployment rate is likely to spike to between 25 percent to 30 percent in the short-term.
“I’m not going to tell you a number you can print, but I think you’re probably right,” he added.