Macdonald Hotels announce 1,800 jobs could be cut due to coronavirus impact on trade

Bathgate-based Macdonald Hotels, which operates two sites in Edinburgh and the Lothians, could cut 1,800 jobs due to a fall in custom during the coronavirus lockdown.

The group, whose portfolio includes the Macdonald Holyrood Hotel in Edinburgh and the Macdonald Houstoun House in Uphall, West Lothian, say they have seen a total collapse of income over the past three months brought on by the Covid-19 pandemic.

The chain, which has 31 hotels and resorts throughout Scotland and England in total, today (June 10) began issuing consultation notices to each of its 2,299 employees.

Group deputy chairman Gordon Fraser said: “We had really hoped to avoid this very unwelcome step, but with no realistic prospects of a return to anything like normal trading for the foreseeable future, we were simply left with no choice. Potentially, we are looking at around 1,800 roles at risk, in all areas and at all levels of the business.

The Macdonald Holyrood Hotel in Edinburgh.

“The Government’s furlough scheme has helped to a degree but our essential operating costs, insurance and some wages are still having to be paid, meaning our monthly cash outgoings are still running at £2 million while we are forced to remain closed. Even after cutting all non-essential spending and with senior management and our remaining staff accepting reduced salaries, the current situation is simply unsustainable.

“There is no realistic prospect of us returning to anything approaching normality for the foreseeable future and, whilst its enormously regrettable, we simply must take these steps to ensure that we have a meaningful business when this situation ends, enabling us to bring back as many of our employees as possible.

“We are seeing more and more of our counterparts being forced into the same, very difficult decisions to either close completely or to cut back on hardworking and valued members of staff. It’s a tragedy.

“Everyone understands that drastic steps had to be taken to halt coronavirus but the only way out of this for our industry is when the current restrictions are eased significantly, and people feel comfortable returning to hotels and restaurants.

“Given the enormous importance of the tourism and hospitality sector for local economies the length and breadth of the UK, it is incumbent upon both the Westminster and Scottish Governments to do everything they can to support our industry. If they fail to do so, many long-standing and well-loved businesses will simply not survive, scarring some of our most fragile communities for years to come.”

The move comes shortly after tourist providers were told they should prepare to re-open in five weeks’ time by tourism minister Fergus Ewing.

He told MSPs it was important to provide an “indicative” date for the sector which had been “devastated” by the Covid-19 crisis.

Mr Ewing hoped confirmation of the date would come at the next but one three-weekly review of lockdown restrictions.

He said: “We hope we will be able to give the go ahead to the sector at the July 9 review.

“Businesses should start to prepare for a provisional return to trading – with appropriate safety guidelines – on July 15.

“This date cannot be definitive and is conditional on public health advice and progression to phase three of the route map.

“Businesses must now use this time to satisfy the necessary regulations and adapt to the new way of living.”

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