Marriott International Inc. the world's largest hotel company with nearly 1.4 million rooms world-wide, said it is starting to furlough what it expects will be tens of thousands of employees as it ramps up hotel closings across the globe.
The company began shutting down some of its managed properties last week, a Marriott spokeswoman said. The employees at these properties won't be paid while on furlough but the bulk will continue to receive health-care benefits that are ultimately paid by the hotel owner, she added, which for the vast majority of the brand's properties isn't Marriott. Marriott is also trimming staff through furloughs at properties that are still operating.
The staff reductions include everyone from general managers to housekeepers. The Marriott spokeswoman said there has been no layoffs or furloughs at the corporate level but those are "under discussion."
Marriott said it expected to bring back as many of the furloughed employees as possible when the novel coronavirus is contained and business returns. In the U.S., about 130,000 employees are on the Marriott payroll, the company said.
Marriott's actions come during what hotel executives and owners say is the toughest lodging environment they have ever seen, as the coronavirus outbreak has led to widespread travel cancellations and government-ordered travel restrictions around the world.
The American Hotel & Lodging Association, a trade group, said the impact of the virus outbreak to the industry is already more severe than anything before, including the Sept. 11th terrorist attacks and the 2007-09 recession of 2008 combined.
For Marriott, which has 30 brands and about 7,300 properties, the move was a stunning reversal after starting the year strong. In January, the company said that it had 515,000 rooms in its global pipeline--its highest number ever--after signing 815 new agreements last year.
The furloughs come as top hotel executives from Marriott, Hilton Worldwide Holdings Inc. and other lodging companies met with President Trump at the White House on Tuesday. Representatives of the hotel industry asked for $150 billion in financial assistance to help them through this difficult period, trade group officials said.
