Crieff Hydro group says 241 staff facing redundancy as lockdown hits

A Scottish hotel chain has given notice that 241 staff are facing redundancy at the start of August, after bookings were wiped out by the coronavirus pandemic.

Crieff Hydro

The family-owned Crieff Hydro group includes seven mainly rural hotels, including Crieff Hydro, Peebles Hydro and Ballachulish Hotel.

The group announced it is planning to shed more than quarter of its workers across the portfolio.

Proprietor Stephen Leckie said he expects bookings to be down by 30-50 per cent this year.

The number of job losses could be reduced or increased, depending on the pace at which lockdown regulations on the hospitality industry are eased.

The group announced that as of yesterday, it had entered a consultation period with staff due to a significant downturn in business as a result of the pandemic.

It said it hoped that through consultation the number of compulsory redundancies, if needed, could be halved.

Mr Leckie said: “When we closed our doors at the end of March it was one of the darkest days in our 150-year history and this is another.

“The impact coronavirus has had on our industry and business has been immediate and drastic.

“As a family-run business built on the strength of our people, discussing potential redundancies is the toughest step we’ve ever had to consider.

“I am personally devastated for every one of our team who could lose their job.”

He added that, despite all the measures taken to reduce costs, lost revenue while the hotels were closed would amount to at least £17 million in this financial year.

He added: “For every month we’ve been closed with zero income, we’ve had to pay £500,000 just to keep our buildings safe and insured. This would have a profound effect on any business.”

The company has used the UK government’s Job Retention Scheme as well as securing an additional £5m in bank loans.

Tourism has been one of the hardest-hit industries during the lockdown. Industry bodies fear there will be many casualties as the sector struggles to be in a position to return.

Marc Crothall of the Scottish Tourism Alliance said: “This is a harsh reality of the impact of Covid-19. Crieff Hydro is a really good, well run and managed group of hotels who have always invested in their employees and I know it will be hurting the family in having to take this action. But without any income coming in for many months, coupled with high levels of monthly fixed costs and with no sign of any long-term grant support being made available to help bridge the gap in the months ahead, businesses like this are now faced with little or no choice but to cut employee costs.

“I suspect we will be hearing similar stories from many more tourism and hospitality businesses in coming days.”

Tourism Secretary Fergus Ewing said it was a “very sad day” for the business owners and their employees.

He said: “The owners have worked very hard to find a means of enabling the hotel group to survive the Covid crisis where, like all other tourism businesses, they have no revenue but substantial overheads to meet.

“Scottish Enterprise has contacted Crieff Hydro Family of Hotels to offer support and assistance and we will do everything in our power to help those affected through our initiative for responding to redundancy situations.

“We have put in place a huge package of support of over £2.3 billion to try and ensure as many businesses survive as possible. We will continue to work with the industry on recovery and with partners across the public and private sector, to ensure a strong return of Scotland’s tourism and hospitality sector.”

The news comes after it emerged hundreds of jobs were under threat at five Scottish luxury hotels in Edinburgh and Glasgow run by the InterContinental Hotels Group due to the impact of the Covid-19 crisis.