Premier Inn owner Whitbread plans to cut up to 6,000 jobs as pandemic hits demand

Whitbread says forecasts of weaker demand has led to its decision to cut 18% of its workforce as the Covid-19 pandemic continues to wreak havoc on the hospitality industry.

Tuesday, 22nd September 2020, 8:59 am

The owner of the Premier Inn chain of hotels, Beefeater pubs and Brewers Fayre restaurants has announced plans to cut up to 6,000 jobs across the UK.

Warning that the coronavirus crisis will continue to hammer demand, the group said the cuts would impact 18% of the total workforce across its hotel and restaurant brands.

Sign up to our public interest bulletins - get the latest news on the Coronavirus

Sign up to our public interest bulletins - get the latest news on the Coronavirus

The firm is hoping a “significant proportion” of the job cuts will be made through voluntary redundancy and lowered contracted hours for some staff.

There are over 50 Premier Inn hotels across Scotland.
There are over 50 Premier Inn hotels across Scotland.

Whitbread said the plans come as demand is set to remain subdued in the short to medium-term and with the Government’s furlough scheme coming to an end next month.

The job losses also come on top of cuts to reduce its head office workforce by up to a fifth, impacting around 150 jobs.

Alison Brittain, chief executive of Whitbread, said: “With demand for travel remaining subdued, we are now having to make some very difficult decisions, and it is with great regret that today we are announcing our intention to enter into a consultation process that could result in up to 6,000 redundancies in the UK, of which it is hoped that a significant proportion can be achieved voluntarily.”

Whitbread expects the jobs to go by the end of the year, although it is not known at this stage which venues may be affected by the cuts.

But it said the vast majority of its 900 hotels and 350 restaurants would remain open.

It came as Whitbread revealed like-for-like sales crashed 77.6% in the six months to August 27 after the coronavirus lockdown forced the closure of its estate.

The group said hotel sales growth has been strong since reopening, with those in UK seaside and tourist locations almost 80% full in August as more Britons staycationed due to travel fears amid the pandemic.

But demand in London and other city centres remained under pressure, with total occupancy levels at 51% on average last month and sales still 47.3% lower.

The Government’s popular Eat Out to Help Out discount scheme in August helped boost its eateries, with the decline in total hotel and restaurant sales narrowing to 38.5% last month.

Trading in the first two months of September remained ahead of the wider market, according to the group, with bookings in tourist destinations still strong.

Whitbread flagged the increased restrictions by the Government to clamp down on a second wave of the pandemic and said it will “continue to closely monitor the situation”.

Ms Brittain said: “Our performance following the reopenings has been ahead of the market, however, it has been clear from the beginning of this crisis that even as restrictions are eased and hospitality businesses such as ours reopen their doors, that demand would be materially lower than full year 2020 levels for a period of time.”

A message from the Editor:

Thank you for reading this story on our website. While I have your attention, I also have an important request to make of you.

The dramatic events of 2020 are having a major impact on many of our advertisers - and consequently the revenue we receive. We are now more reliant than ever on you taking out a digital subscription to support our journalism.

Subscribe to scotsman.com and enjoy unlimited access to Scottish news and information online and on our app. Visit https://www.u2swisshome.com/subscriptions now to sign up.

By supporting us, we are able to support you in providing trusted, fact-checked content for this website.

Joy Yates

Editorial Director

 0 comments

Want to join the conversation? Please or to comment on this article.