Some of the UK's leading hoteliers disagreed over the impact of the introduction of the National Living Wage on the hospitality industry, during a discussion panel at yesterday's HOSPACE conference.
When asked by Peter Hancock, chief executive of Pride of Britain and chair of the panel, what was the biggest worry the operators faced in the year ahead, two operators unequivocally said the Living Wage, which will be introduced in April 2016. Starting at a rate of £7.20 and rising to £9 an hour by 2020, the Living Wage will replace the current £6.50 minimum wage.
Les Asplen, managing director of Best Western Hotel, said that many of the 280 independent properties within the consortium across the UK were concerned how they were going to pay for the new statutory rate. "Ultimately it will manifest itself in increased prices for guests. There will also be an impact upon ongoing investment in hotels."
Peter Cashman, chief executive of Focus Hotel Management, the 21-strong group, agreed with Asplen. "It will not only affect those who will be receiving the new Living Wage, but there will also be a knock-on effect for everyone on higher levels of pay," he said. "As a result, we are predicting an eight to nine per cent increase in pay roll across the board. "We are currently looking at making efficiencies to pay for it."
However, Jonathan Raggett, managing director of Red Carnation Hotels, which has eight properties in the UK, disagreed with his fellow panellists, describing the Living Wage as a "jolly good thing".
"Faced with the difficulties we all have attracting staff, this is something we should all be willing to embrace. It means that we will all have to work even harder to get people into our hotels, restaurants and bars to cover the cost."
HOSPACE, held at the Sofitel London Heathrow, is the annual conference for hospitality professionals working in financial management, revenue management and IT.