COVID-19 & The Hotel Industry | Baker & Company
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In the past week, confirmed cases of COVID-19 have exponentially increased across Canada, forcing both citizens and businesses to quickly react to new realities as they present themselves. One area currently facing more difficulties than others is the hotel and hospitality industry, as the impetus to travel has been drastically reduced. This is having a particular impact in the week before March Break, one of the biggest travel weeks of the year in normal circumstances.

Already the impact is being felt with massive tourism destinations closing, such as the announcements yesterday and today regarding Disneyland in California and Disney World in Florida. In addition, all Broadway shows in New York have gone dark, and businesses are cancelling conferences around the world. As more and more jurisdictions plan bans on large gatherings, this trend will only increase and is expected to hit industries such as hotels, airlines and restaurants particularly hard.

There are several issues to consider with respect to the hotel business, from protecting employees to decreased business to the health and safety of guests. Here, we look at the COVID-19 crisis as it relates to the hotel business and its employees in particular.

Hotel & Hospitality Employees

Many people are currently finding themselves working from home in an attempt to limit social contact at work and slow the spread of COVID-19. However, not everyone is lucky enough to work in a job that affords them this option. Hospitality employees work in an industry that is almost entirely customer-facing, so ‘working from home’ translates to not working at all. Nearly 50% of all people in Ontario rely on every paycheck in order to meet their financial obligations including paying for housing, utilities and food. If a hotel worker is forced to enter into quarantine, or their employer shuts down temporarily, what are they to do?

A recent article in the National Post interviewed Nita Chhinzer, a professor at the University of Guelph, who has studied disaster preparedness in the hospitality industry, on implications for hospitality employees. According to Chhinzer, the key to maintaining safety for employees and customers alike is to encourage quarantines whenever an employee has been exposed or is showing signs of the virus. She notes that there is a culture of “presenteeism” in the hospitality industry in particular, because of the dependence on tips. As a result, employees are often tempted to work even when sick. In this current crisis, employers are being encouraged to advise employees to quarantine themselves if there is any public health concern.

When it comes to income, employers are also encouraged to both lobby the government for financial support, as well as work with individual employees on potential solutions. One idea presented by Chhinzer is to negotiate pay upfront for time worked later. Of course, this only defers the problem, so ultimately the government may need to step in to help subsidize the hospitality industry through the crisis.

On a positive note, the reluctance to fly or travel by train could place an increased demand for hotels from Canadians who are looking to fill the week of March Break in the face of cancelling international travel plans. Further, all public schools in Ontario have announced they will close for two weeks after the break as well. This could see an increase in domestic travel for healthy Canadians in the interim. The situation is obviously dynamic and apt to change at any time, so only the future will tell. However, hotels and other hospitality industries should be sure to prioritize employee safety and work with various parties to protect employees from lost income that may result while we weather the worst of this ongoing crisis.

At Baker & Company, our hotel law lawyers conceive of, create, and implement tailored legal solutions specific to each client.  We rely on our broad base of experience and expertise to provide exceptional legal guidance. Call us at 416-777-0100 or contact us online for a consultation.

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