According to this story, they fired their housekeeping staff - approximately 100 people.
In their place, Hyatt brought in 100 housekeepers who agreed to work for half ($8.00/hour vs. $15/hour) of what the fired employees had gotten. And no benefits.
The fired workers had been getting health insurance through Hyatt.
Here's how Hyatt characterized the move:
"'As part of an ongoing drive to address challenging economic conditions, the Hyatt hotels of Boston have restructured their housekeeping services,’ according to a statement from the hotel. 'Regrettably, the restructuring included staff reductions.'"
Bringing in employees to replace the ones you've fired is not a "staff reduction." It's a transformation of the workplace. It's letting go of people, some of whom devoted two decades to the company, and replacing them with low-wage, no-benny workers who will barely be able to scrape by on the salary they earn in this job.
According to the news story, the Hyatt experience is "uncommon" in the industry:
"Other hotels have taken a different approach to riding out the recession. Earlier this year the Liberty Hotel ended its contract with the company that provided its security and night janitorial service and replaced them with hotel workers from other departments who might have otherwise been laid off. “We would not [outsource housekeepers] because we want to tightly control the guest experience here and the cleanliness,’’ said managing director Jim Treadway.
Representatives from the Hilton and Marriott hotel chains said they have not outsourced their housekeepers and have no plans to do so."
Just this week, BusinessWeek included Hyatt on its list of "Best Places to Launch a Career."
Not if you're a housekeeper at Hyatt, obviously. But that's just a job. Not a career. So who cares? We'll see if such innovation in HR is contagious....
2 comments:
Anne:
It's possible Hyatt made a tactical mistake which will bite them when the economy improves.
But there's a logical flaw here:
Why do the workers that were fired when Liberty terminated its outsourcing contract get less sympathy from you than the Hyatt employees?
It's even possible that Hyatt actually hired those very same workers? (And then laid-off their own in house staff.)
The post makes it sound like Hyatt's unskilled housecleaning staff was receiving wages materially higher than the market rate. How can that be? Were they unionized?
Rocky
Rocky, it is my understanding that contract employees are considered "temporary" and are the employees of the contracting organization, not necessarily the hotel.
Liberty fired the contract labor force in order to keep its long-time staff. So to me, that shows a loyalty to the permanent staff.
I believe that when contracting employees are let go, they are not considered "laid off," since they are considered temporary (and are not counted among the ranks of the unemployed.)
Some of the Hyatt employees had been with the company for many years - as Hyatt employees.
I do not believe they were unionized. And I don't know how the salary compares to the salaries paid at the competing hotels in Boston.
I see the value of using contract employees in certain situations. I know some companies that use contract employees to supplement their sales force when launching a new product. They can temporarily bring in a team - and then consider building from there, depending on the success of the product.
However, with Hyatt, they've dumped loyal employees to bring in temps who work for a lot less and get no bennies. Probably the model for the future in many companies - but not great for labor. Probably not going to improve the quality of service for customers. May cost them in the end. We'll see. Hope this isn't the labor wave of the future.
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