The way forward for hospitality workers

Months into the Covid crisis, the reality of where the hospitality industry stands is becoming clear. A recent report commissioned by hospitality trade bodies warns that one in four businesses may never open again, potentially putting 16,000 workers out of a job across the North.

by Neil Moore, Regional Hospitality Organiser, Unite (personal capacity)

January 2020 was a simpler time. Workers in the hospitality industry were infuriated at being classed as ‘unskilled’ by the Johnson government and deserving of low pay by the bosses. The trade bodies – representing the bosses – were celebrating a ‘bumper year’. Projected spending in restaurants was to reach £269m (a 10% growth rate) and hotel revenues across the North projected to increase by 4% by 2023 – impressive given the 40% expansion of capacity in the hotel sector in 2018/19. Politicians in the newly formed NI Executive were fawning over the solid hospitality industry, claiming it should be pushed further as a key economic driver. 

Of course, the reality of this impressive growth was that it was largely off the backs of workers in a notoriously exploitative sector. With median average wages well below a living wage, the majority of workers on precarious zero-hour contracts and sexual harassment rampant. This level of exploitation and poor employment conditions are heavily linked to low union density, decades of anti-worker legislation and no serious plan to organise the sector from the leadership of the trade unions, backed with the resources activists and workers need.

Covid pandemic – workers thrown under the bus

Then the Covid-19 pandemic came and, with it, the threat of overnight decimation of the industry. The arrogant, callous response of the Johnson government to the pandemic, combined with the slow and lacklustre response from Stormont, only deepened the wound. The politicians were clearly not willing to place public health ahead of profit. The failure to impose a lockdown and close non-essential businesses earlier – as opposed to their approach of simply calling for people to “avoid pubs,  clubs, theatres and other such social venues” – contributed to confusion, with some venues shutting and others remaining open – not wanting to miss the all-important St. Patrick’s Day trade. For many workers, this became the straw that broke the camel’s back – exposing their bosses’ disregard for their safety. Not a day later, with the intention of a lockdown announced, many of those same workers and tens of thousands more were laid off, often by text message. 

The domino effect of lay-offs was not started by struggling small businesses, but rather by profitable companies – only weeks before NI hotels reported their strongest January in years and a record breaking Valentine’s week. Bill Wolsey – owner of Beannchor, one of the largest hospitality operators in Ireland – hastily laid off 800 workers, despite making over £11 million in profit during 2017/18. 

The rollout of the Job Retention Scheme (JRS) by Tory Chancellor Rishi Sunak – along with an array of other supports for businesses – initially came as a welcome relief to many hospitality workers. While these measures came as a surprise for some, they reflected a right-wing government acting primarily to defend the profits of big business, but also to stave off the potential for social revolt if mass unemployment emerged overnight. Calls for a ‘national unity alliance’ were pushed by both bosses and some union leaders. 

Whilst guaranteeing 80% of wages and protecting jobs initially, the ‘progressive’ veneer of the Chancellor’s scheme was soon exposed. The reality was that this was a bailout for the bosses, who control which employees are furloughed or even whether they are furloughed at all. Hastings Hotels applied their own arbitrary criteria of 20-weeks’ minimum service and a £75 weekly income threshold, essentially allowing them to cut off the incomes of many of their most precarious staff, leaving them formally employed but, in order to receive an income, having to resign and claim Universal Credit or seek alternative employment.

While bosses’ organisation UK Hospitality initially suggested employers in the sector would top up workers’ wages, this largely didn’t materialise. Bosses could never be trusted to cough up in this crisis. The Tories were more than aware of that and designed the scheme to make a top-up optional, allowing their big business friends a huge break in their labour costs.

The delay in grants and loans, along with the rollout of the JRS, led to more layoffs and bosses choosing to simply leave workers unpaid until they received the state wage subsidy. This was particularly stark in hospitality, as many smaller businesses faced the immediate prospect of going under, with no cash flow to sustain them until state subsidy became available. Sometimes, this was down to the tight margins that hospitality businesses run on but, more often than not, down to reckless owners squeezing revenues out of their cash-rich hospitality businesses to fund other endeavours such as property speculation – truly reflective of the del-boy-esque capitalism that is the norm for this sector. These employees face almost certain unemployment if they haven’t lost their jobs already – as soon as the pandemic is over when government protections are eventually withdrawn.

Mass jobs losses despite rushed reopening

Months into the Covid crisis, the reality of where the hospitality industry stands is becoming clear. A recent report commissioned by hospitality trade bodies warns that one in four businesses may never open again, potentially putting 16,000 workers out of a job across the North. These shocking figures have been used by employers in the sector to put pressure on the politicians to meet their demands for accelerated re-opening. For the NI Executive, the idea of the tourism industry – often seen as a reliable area for growth and ‘a golden goose’ for the local economy – tanking is unthinkable. Economy Minister Diane Dodds was quick to respond, with the setting up of a Tourism Recovery Steering Group – made up solely of businesses and industry representatives, without even a token workers’ representative.  This approach by the Executive, of allowing the foxes to run the henhouse, is rotten.

It is no surprise that such a cabal has brought forward the proposal to move towards a much earlier reopening date for hospitality businesses on the 3rd July. Whilst some limited draft safety guidance has been circulated, this does not go far enough in providing the protections necessary for businesses to safely reopen – capacity limits, contact tracing and so on – linked to a government programme of mass testing and genuine engagement with workers on when and how workplaces can reopen. ‘Guidance’ from the government is clearly not enough, particularly given the nature of our hospitality industry, where workers often have to deal with members of the public who are intoxicated or belligerent, making it near impossible to manage while maintaining social distancing. 

The kowtowing approach to profit and business interests by the Executive parties is one that is being quickly exposed to many workers. Now the bosses have got their way in terms of a reopening date, their lobbying machine has switched to calling for a reduction of social distancing from 2m to 1m. Their reasoning behind this is purely economic, with bosses presenting an engineer’s report of how many people they can cram into a bar with 2m vs 1m social distancing as their key evidence! 

Despite the nod being given to hotels to reopen in order to supposedly help protect jobs, this was immediately followed by redundancy notices being issued in some of the wealthiest hotel chains, along with sweeping changes to terms and conditions pushed in others. The illusion that bosses take health and safety seriously is being smashed and, with it, a new focus is being placed on the need to organise precarious sectors such as hospitality.

Unions must step up campaigns

This has been the experience for Unite Hospitality NI, in which Socialist Party members play a central role. Membership of Unite in this sector has doubled in the midst of this crisis, as more workers turn towards unions for answers. Such growth will pose a serious challenge to the union movement. For years, the approach of closing ranks and doing little to genuinely organise the sector – and others like it – has allowed this accelerated race to the bottom. Now, small groups of union activists in the sector across Britain and Ireland are seizing the initiative and establishing organising campaigns – such as those in TGI Friday’s, Wetherspoons and McDonald’s – which have concretely provided an example for both the bureaucracies at the top of the unions and for workers themselves. 

A lot of union leaders, both local and national, took their foot off the pedal and effectively retreated in response to this crisis, giving in to pressure from the establishment for ‘national unity’ with their comparisons to a ‘war effort’ – the opposite was true of those fighting to organise this industry. Despite the restrictions posed by lockdown and the difficult conditions not conducive to more traditional organising methods, Unite Hospitality has been a cutting edge for how unions in general should respond to this crisis. 

As businesses decided to remain open on St. Patrick’s Day, protests were called by workers across the industry in Belfast to demand they take the health of the public and their staff seriously and close. Unite Hospitality reps assisted in organising the socially distanced protest with full PPE, and called out the inaction of the politicians. Of course, this was met with ambivalence by some workers genuinely fearing for their jobs before government support was put in place – however, it gave confidence to others to pressure their employer to shut later that evening.

The ensuing weeks saw a bustle of activity; daily online meetings of activists were the norm, despite some within the union movement attempting to suspend such activity. In the absence of any real leadership from above, young workers in hospitality came together to put forward an alternative program to deal with the effects of the crisis. Unapologetic, sharp campaigns were developed through the press and social media to name and shame employers, which led to victories, including the reversal of layoffs in Hastings Hotels and even pushing international giant Marriott to furlough all 1,500 of its casual workers who it had previously kicked to the dirt.

All this was achieved in a fortnight, on a shoestring compared to the resources and weight the union movement can bear as a whole. If these are the wins that relatively new and inexperienced reps and organisers can deliver in the midst of freefall collapse of a sector, one can only imagine what could be done with a properly resourced, targeted and planned campaigns across Britain and Ireland.

As lockdown measures are lifted, there will be a shift in attitudes. For many workers, their treatment during this crisis has been the final nail in the coffin – with a Unite survey revealing that 48% of workers are looking for work outside of hospitality, although opportunities are limited due to the generalised economic crisis. Those remaining in the industry will face a further race to the bottom, with cutbacks to hours, mass job losses and unsafe workplaces. Most workers no longer have any faith that employers or politicians will have our interests at heart when it comes to our livelihoods and our health, when they are competing with profit. This can create the conditions for a serious fightback.

Unions should not sit back at this time – we must develop an understanding among workers of the real role of organised labour, which is using collective industrial strength to win victories in struggle. Anything less – for example, taking an approach of simply acting to manage redundancies – could present more of a setback to the organisation of real industrial power among hospitality workers that is desperately needed.

Following on from the weekly discussions of organisers and reps, Unite Hospitality has developed a ‘Fair Deal’ for workers in the industry. For socialists, many of these measures will simply act as a stop-gap, but even for this plan to be fully implemented will be a mammoth fight and could importantly tap into a mood amongst workers in the industry for a ‘reckoning’ with the bosses after the experience of the past few months. It could also act as a credible alternative and counter to the bosses’ idea of a ‘new normal’, preparing for a further race to the bottom in the coming months, with the threat of job losses and mass unemployment being used to justify further casualisation and attacks on already quite limited terms and conditions.

Workers must control health and safety

The union’s plan notably calls for workers’ engagement and management of health and safety – launching an initiative for elected and well-trained ‘roving’ representatives. Winning this would be huge – not only to empower workers to take health and safety into their own hands where bosses clearly don’t care, but it would also become a tool to give union reps an opportunity to speak to staff across the industry and build union power in workplaces that have previously had no union presence.

A series of victories around health and safety could concretely pose the question of workers’ control more clearly for workers in the industry. Demands for improved safety will not be surrendered easily by the bosses. The limitations of the Health & Safety Executive and local councils had already been made clear to many workers, even before Covid. Ultimately, it is workers who know best how businesses can operate safely through this crisis and it is workers who have the power to shut workplaces until they’re safe.

The plan also calls for a ban on zero-hour contracts and challenges the legality of any redundancies while the Job Retention Scheme (JRS) is in place. Socialists would add to this the demand for a £12 minimum wage to eliminate poverty pay. Support for small businesses that cannot safely reopen at this stage should be provided on the basis of proven need. Beyond the planned October end of the JRS, Unite’s plan calls for continued state support for tourism as a whole. This would be part of a government programme of purposeful training to upskill the workforce in hospitality; conditional on the protection of jobs and extension of rights to workers within workplaces benefiting from such. Such a programme would not only disincentivise job losses for a lot of employers but also challenge the perception of the industry as low-skilled with little chance of progression.

Reorganise the sector in interests of workers and customers

A battle for a ‘Fair Deal’ in hospitality will be hard-won; it will require workers to act collectively and will require decisive leadership. A win on even these modest demands would set down a marker for previously unorganised workers that struggle can deliver and provide an example from which other workers can draw inspiration.

Even with these measures, the deep global recession we are in will have a dramatic impact on tourism and hospitality over the next period. The Covid crisis will undoubtedly have an effect on business travel with the ‘new normal’ being one of increased online meetings and a significant drop in large conferences and conventions as infection control measures and restrictions on travel remain in place – particularly if we see a second spike of the virus globally. Leisure travel will also be severely impacted as holidaymakers are less likely to travel internationally. 

The mass job losses proposed are, in reality, aimed at securing future profits. Workers should demand to see the books of any company posing redundancies, to see where the money from the ‘bumper’ years has gone. With the amount of work likely to decline, work should be shared out amongst staff, particularly in the scenario of reduced capacity and less trade for a prolonged period of time. Workers could work a reduced working week with no loss of pay, which would be welcomed by all – for example, in the case of chefs who often work above and beyond their contracted hours, usually with no additional pay.

Under capitalism, a reduction in work spells disaster for workers as there are no serious opportunities for retraining or changing jobs in what could be the worst unemployment crisis in decades. 21st-century capitalism views work in hospitality, retail and call centres as a dumping ground for young workers as industries that offer better conditions and wages such as manufacturing and construction continue to decline. If the work isn’t there even with restructuring, then what must be considered is retraining and redeploying workers into other socially useful jobs – of course, this can only be achieved on the basis of public investment and a democratic economic plan.

Hospitality for people, not profit

If a company or the industry as a whole cannot sustain jobs, then nationalisation is an obvious option. This has been done in the hospitality industry before. During the First World War, the Central Control Board was established to restrict and manage the sale of alcohol. It nationalised the entire drinks trade in the north of England; bringing pubs, small inns and breweries under state control. The state-managed pubs and breweries were hugely successful – some remaining under public ownership until the early 1970s. They were largely responsible for changing the design of ‘public houses’, paving the way for a cultural shift in how drinking was viewed and the industry operated. This is an important precedent, given the huge challenges that face the industry in the midst of what will be a prolonged public health crisis. The state could take these measures again, in the interests of saving the tourism industry, which faces a crisis not only in the hospitality sector but in aviation as well.

Of course, we have to be clear about what kind of public ownership we want. Clearly, a national tourism board owning and operating hotels, pubs, tourist attractions and even airlines would be a massive victory. However, socialists argue that we should take this further. We argue that workplaces and industries should not only be publicly owned but also placed under the democratic control and management of the workers within them – this would ensure that employment is not only secure but socially useful. 

Hospitality plays a vital role in society, not only in providing basic needs such as food and accommodation but in providing a space for people to socialise and relax. A nationalised hospitality industry, which was possible to a limited extent under capitalism for decades, would have a part to play in a socialist economic plan. It would be run on a not-for-profit basis to make holidays, recreation and experiences such as eating out more accessible for working people.

The coming months will expose the contradictions of the capitalist system to many more workers as the system enters into the deepest crisis in living memory. While it is obvious now that the only way that both jobs in hospitality and this industry itself can be sustained going forward is through massive state investment, Keynesian ‘New Deals’ will only act to patch up a system that is hardwired to put the interests of profit before the interests of workers. We need a fundamental restructuring of the economy and society along socialist lines, run by and for working people, not profit.

Previous Article

As retail reopens, organise to secure safety, decent pay and conditions!

Next Article

Rebuild our health service - invest, democratise, kick out the profiteers!

Related Posts
Read More

BLM activists vindicated: Drop the fines now!

The Socialist Party welcomes the announcement from the Public Prosecution Service (PPS) that all charges related to last summer's Black Lives Matter protests in Belfast and Derry are to be dropped. The PPS recognised that the events were organised in a responsible manner, aimed at minimising the risk of Covid, and that they related to a matter of "important social concern". All fines against those who took part in these protests - and a similar protest against gender violence in Belfast, organised by ROSA in the wake of Sarah Everard's killing - must be immediately rescinded and reimbursed.

Read More

Northern Irish capitalism: Misery and exploitation for workers and young people

Working class and young people have seen their wages eroded by an increasing cost-of-living, leading to a real downturn in standards of living. And the economy in the North seems to only be getting worse. Business insolvencies (effectively bankruptcies) in the last quarter of 2023 were 62% higher than in the previous year and were at the highest rate since the data series began in 1960.