The Hospitality Giant Making Its Staff Homeless
After announcing a surge in profits to £560 million, hospitality giant Whitbread told its workers it was making 1500 redundancies that would cause many of them to lose their homes.
‘We’re all scared of what is coming. There are people who are losing not only their jobs but their homes, too. There is little to no support from head office. We are counting down the weeks, wondering what will happen.’
That was the reaction from one worker to the news in late April that Whitbread was planning to make 1,500 redundancies and close more than 200 restaurants. The hospitality giant, employing over 38,000 people in the UK, is hardly on the brink of financial ruin. In fact, the announcement was made on the same day that Whitbread reported a 36 per cent increase in profits to £561 million for 2023/24.
Louise began working for Whitbread nine years ago, starting off as a bartender before eventually working her way up to restaurant manager. She’s worked at four different sites and three different brands, including the Beefeater, Table Table and Brewers Fayre. She tells Tribune she is appalled by the way Whitbread has treated her and her colleagues.
‘I’ve been told I’m at risk of redundancy. There are no alternative job roles for me,’ she tells Tribune. ‘The consultations are meaningless, and they are speeding through them to get to the final date so that people can be fired.’
Sarah, a housekeeper who works at a Premier Inn in Derby, describes the redundancies as ‘devastating’ for her colleagues. ‘I’ve spoken to quite a few people affected. A lot of them won’t get statutory redundancy pay because they’ve been with the company for less than two years. There’s a lot of fear.’
Despite Unite the Union having hundreds of members at 100 impacted locations, including some whose living accommodation is tied to their employment, Whitbread has refused to consult with the union or answer any of its questions about the redundancy process.
‘They have not done a proper consultation at all,’ says Sarah. ‘Colleagues of mine were only starting to get consultations on the 14 June to tell them, your job’s gone by 4 July. That’s literally a few weeks. It’s nowhere near enough time to try and find a home and look for a job.’
Louise concurs. ‘I have attended my second individual consultation today and have no answers to the questions I raised in my first meeting.’
Chris*, a receptionist who has worked at Premier Inn since 2022, says the job losses took his colleagues by surprise. ‘Apart from a few people in management, everyone else in the company was left in the dark. They only announced it because it was leaked to the press.’
At least three workers in Derby, says Sarah, will be made homeless because they lived in the flat above the Beefeater, which will now be demolished. ‘It was a decent arrangement. They worked extremely hard and picked up extra shifts. They are now going to be evicted’
Though not directly affected by the latest round of redundancies, Sarah believes her current employment is increasingly insecure. ‘My hotel is getting smaller. People are worried. If you’re getting smaller, you won’t need all the housekeepers you have. So when is it going to affect the housekeepers?’
Business as usual
The hospitality industry is characterised by low pay, high staff turnover, and insecurity. Despite some breakthroughs, union density remains low. That’s why companies like Whitbread have no qualms about celebrating leaping profits by announcing mass job cuts without concern for those whose livelihoods depend on such employment.
For Sarah, this is part of a broader pattern of neglect by Whitbread, who frequently exploit a workforce they see as cheap and expendable. ‘If you dare argue or anything, then you’re threatened with disciplinaries and investigations. They’re just making the job harder and harder and harder with unreachable targets.’
Last year, Whitbread was named and shamed by the Government for failing to pay one of its workers the minimum wage. The hospitality giant has long been criticised for failing to pay the living wage or provide company sick pay — the consequences of which have been acutely felt during the cost of living crisis. ‘A lot of us rely on Universal Credit because we get such a low income,’ explains Sarah. ‘We’re trying to pick up extra shifts, killing ourselves in a job just so we’ve got enough money to pay the bills, pay the rent, feed our families and clothe our children. It’s difficult.’
Desperation to put food on the table and the work’s insecure nature means Whitbread can access additional labour at short notice. ‘Your hours fluctuate a lot,’ says Sarah. ‘It’s unreal. We’re sometimes called at 11:00 at night or 7:00 in the morning to come and pick shifts up. And they put pressure on you to pick the shifts up.’
‘If we had been underperforming or other sites within our region had, our hours would get cut, which had a massive impact on wages as we were working four or five-hour shifts instead of our usual eight or nine,’ adds Chloe, ‘We found it unfair that when we were being praised for hitting sales and incentive targets that we still had to lose hours due to other sites not hitting their targets.’
In 2018, Channel 4’s Dispatches sent an undercover reporter to work as an agency housekeeper at Premier Inn. The programme highlighted how staff were not being paid for all the hours they worked and were under continual pressure to hit punishing and unrealistic productivity targets.
In all but one of the sites Louise has worked at in her nine years at Whitbread, she has seen intimidating behaviour from people in charge. ‘I have witnessed general managers abusing their power to constructively dismiss people they don’t like, purposely putting people on shifts they can’t do and denying holidays for no reason. I have seen a lot of bullying from kitchen managers towards front and back of house teams and general managers not stepping in and often being a part of the problem.’
Taking A Stand
Whitbread says the restaurants it is closing are ‘less profitable.’ As part of its restructuring, the company intends to close 112 restaurants to convert the space into new hotel rooms and sell a further 126 restaurants.
The hospitality giant believes sizing down its restaurant business while expanding its hotel business will increase company profits. But workers believe this is an ill-thought-out strategy.
‘The site where I work is a tourist hotspot. We are busy from the end of March right through until November. We rarely miss sales plans, and we also have a lot of regulars who visit when we are quiet. The local community prefers the Beefeater over the other pubs in the area, so we were always busy. I find it hard to believe we were not making a profit.’
Sarah takes a similar view. ‘Sometimes we’ve had them come over to us saying, Look, slow down with the bookings. We’ve got too many people for breakfast. Sometimes they haven’t got the staff to manage.’
‘If they were to invest in the workforce’, says Louise, profits would be much higher. ‘Labour kept being cut, and outside guests didn’t want to return because of the poor service they received. We were told to prioritise hotel guests over walk-ins. If more labour was provided, this sacrifice would not have been made.’
Hospitality is the third largest employer in the UK, with 3.5 million people working in the sector. Thus far, trade unions have struggled to gain a foothold in the industry. But efforts are underway to try and change that. In recent years, Unite Hospitality has managed to unionise hundreds of workers at Whitbread. The union has written to the company warning that its failure to carry out a proper redundancy consultation process may result in employment tribunals being launched.
From paltry pay to mass redundancies, Whitbread’s treatment of its workforce illuminates a broader problem in the hospitality sector. Insecurity is baked into employment practices to ensure workers are powerless in the face of exploitation.
Multinational companies are making millions on the backs of their workers whom they hire and fire with ease.
Last week, the union held a loud and angry protest outside the hospitality giant’s HQ in Dunstable. But while protests can draw attention to such injustice, ultimately, it is through unionisation in the workplace that workers can develop the leverage power to hold companies like Whitbread to account.
‘Low union membership is definitely an issue,’ says Chris. ‘I have put out posters encouraging people to join the union. I also send out regular emails in my region in the hopes of trying to build to grow.’
‘I was led to believe up until two years ago that we weren’t allowed to join a union because that’s what we were told,’ says Sarah. ‘I’m the type of person to speak up for my colleagues. And they really don’t like that. But if we don’t stand up for each other, who will?’