Small and medium sized hotel in Hanoi arranges temporary absence for staff

Hanoi Emerald Water Hotel offers two temporary arrangement for its staff

According to the Vietnam Tourism Association, the coronavirus epidemic has impacted the development of tourism in many countries, including Vietnam. In the past two months, occupancy rates at hotels and resorts nationwide fell by 20-50 per cent in comparison with the same period last year.

The number of tourists visiting leading destinations such as Hanoi, Ho Chi Minh City, and Halong Bay at the start of the year dropped by 50 per cent. In addition, the number of international tourists visiting Vietnam is forecast to fall by 60 per cent in March, as many tours have been cancelled.

According to Hanoi Tourism Department, in the first two months, Hanoi welcomed approximately 3.56 million tourists, down 25 per cent on-year. 844,000 of these visitors were foreigners. In February alone, the figure was estimated at 1.3 million, down 45.5 per cent. Tourism revenue was also reported to drop by 32 per cent.

This has put small- and medium-sized hotels in Hanoi in a difficult spot as they already operate with low profit margins and are extremely dependent on a steady stream of tourists looking for cheap hotel rooms.

Tran Van Dinh, managing director of Viet Bao Anh Hotel, said that compared to last year, booking volumes declined in early December 2019, with a plunge in mid-January. At present, bookings are down 40-50 per cent on-year.

Dinh, a host from the Bella Rosa Hotel system complained that since February 5, he had to close three out of 10 hotels, suffering a damage of VND8 billion ($347,830). At present, the revenue of these hotels is mostly used to pay staff members' salary.

To avoid having to let employees go in times of hardship, Hanoi Emerald Water Hotel has come out with a temporary scheme for its employees for the next four months, or until the coronavirus (COVID-19) is brought under control and the company gets back on track.

Accordingly, the hotel offered two options for staff to choose from: they can either stay at home and receive an unemployment support of VND1.5 million ($65) a month or continue working with reduced working days at a fix salary of VND4 million ($173) a month for all employees. Reduced working days would mean 18 days a month, with wages equal for employees at all tiers.

“At this time, there is no difference between staff and managers. Even the chef of the hotel will be paid VND4 million ($173), instead of their usual VND20 million ($869.5),” the hotel's manager said.

The arrangements will last for the next four months, with business as usual resumed on August 5 if the epidemic has been brought under control by then.

The manager explained that the reductions are necessary as in the last ten days, the hotel's daily revenue was VND1-3 million ($43-130), one-third of which is taken up by utilities.