Marriott To Furlough Two Thirds Of Corporate Staff

Filed Under: Marriott

While much of my focus the past couple of weeks has been on airlines, the hotel industry is obviously struggling as well, and has asked for $250 billion in government aid. We’ve seen many hotels around the world close temporarily, and those that remain open are largely running occupancy in the single digits.

A few days ago we learned that Marriott will be furloughing tens of thousands of employees at managed properties over the coming months. Now those furloughs are being expanded to Marriott corporate employees.

As reported by the WSJ:

  • Marriott will be furloughing about two thirds of corporate employees, both in the US and abroad (this would include contact center employees)
  • Most furloughs are expected to last for 60-90 days
  • Furloughed corporate employees will receive 20% of their salary, which can be put towards healthcare and other costs
  • Corporate employees who stay on will take 20% pay cut and reduced work weeks

I understand Marriott’s need to cut costs, though I would assume that largely there’s more need for corporate employees than ever before, as I assume Marriott properties need more support and guidance than at any point prior to this…

This is awful, and my thoughts are with all those being furloughed.

Comments
  1. LOL, it looks like a photo of the FRA Marriott at the left and the FRA Sheraton to the right. Both buildings used to be the Sheraton till recently. The background building houses the Hilton and HGI.
    Honestly, this used to be a home away from home but they changed. Things became corporate and too tough. I do not mind the Business feeling some pan. While I feel for the employees, lately they seemed devoid of any human nature, the immediate answer was always no. This applied to things big and small. I am lactose intolerant. Many lounges and restaurants in Europe are prepared with milk alternatives or even lactose free milk. While the old Sheraton Towers at FRA featured lactose free milk, the current lounge is a strong NO.

  2. This is really really sad. The economic devastation and destruction is so massive and incomprehensible by most people. Here where I live in Southern California, almost everything is closed except grocery stores. There are a LOT of small and medium sized businesses that will NEVER recover from this.

    This most definitely will cause a Depression if this goes on for much longer.

  3. Maybe I’m wrong, but I could care less about the Marriott layoffs. I’m sure there are some good people, but I feel everything Marriott touches turns to crap. The best thing that could happen to them is they get humbled and maybe start valuing their customers. You know, us “noise around the edges”….

  4. A sensible move by Marriott. They have plenty of cash and credit lines to continue for the foreseeable future. They don’t however have cash to cover payroll indefinitely. That’s why the hotel industry asked for assistance so it could keep people on the books and cover payroll or a reduced payroll but because of a false narrative hotel chains will just have to lay off people temporarily and let them collect unemployment and checks from the government. Marriott does own some of the hotels they operate but the majority are not owned so any government aid is complex.

  5. After the 2016 election, Marriott International CEO Arne Sorenson wrote the following open letter to President-Elect Donald J. Trump. It should be pointed out that Marriott and its leadership have a history of supporting Republican candidates and former GOP presidential hopeful and now Senator Mitt Romney was on Marriott’s board of directors.

    Congratulations on your election as President of the United States. You ran an impressive campaign, never doubting your message. You now have the opportunity to lead from the White House and all of us want you, and the nation you will serve, to be successful.

    I was gratified to hear your inclusive words in your election night speech. As President, you will have the ability to represent everyone, whether they supported you in the election or not. Particularly after this campaign, we need leadership to bring us together, to find areas of common ground and to help us find a path through issues that require compromise.

    While your Electoral College victory was solid, you should guard against the victor’s curse: Don’t convince yourself that your victory is a personal mandate that absolves you of the need to collaborate in governing. While millions voted for you because they agreed with your ideas, millions voted for you even though they agreed with only some of your ideas or because they didn’t like the alternative. And, of course, many did not vote for you. Bring all those people along with you. Leadership is about listening and then convincing. It is not about mandating.

    [For the rest, see https://skift.com/2016/11/11/marriott-ceos-open-letter-to-president-elect-trump/ ]

    Well, at least we know that when Marriott sneezes, Trump Organization has a cold.

  6. Hotels may be re purposed for medical/quarantine facilities in some cities so hotels might make some money off that to cushion the blow.

  7. Paulz: you are absolutely WRONG! There are thousands upon thousands of people who are losing their jobs, losing the ability to receive an income and the ability to pay their bills, feed and clothe their families, look forward to a decent and comfortable future. Now ALL of that is coming apart and for many the sky is falling and crashing all around them.

    No matter how we feel about Marriott’s policies, nearly all of the people who are losing their jobs do not deserve that kind of sentiment. They derive our thoughts and best wishes that they (and everyone else) will be able to get through this crisis.

  8. Not to fear, Arne is giving up 10% of his annual total compensation the rest of the year (based on 2019 data). How generous!

  9. The short term challenge is to find a way to survive a virtually total collapse in income ( via cost reductions/burning cash/taxpayer funding); longer term they’ll be judged on how they’ve treated staff and customers. The ‘usual suspects’ will say their only responsibility is to shareholders, but it’s something of a ‘no-brainer’ to point out that without loyal staff and customers they won’t have a business in which people will want to invest.

  10. @ GSBEWR
    These people, in most countries are covered by something like unemployment insurance. Why should some people be bailed out to a higher extent?
    By the way, Unemployment insurance premiums are based on a firms claim history. An airline or Hotel bailout lets them keep a good history.
    This is as stupid as NYC bailing out Taxi Medallion owners that bought low, refinanced as it went up in value, and are now asking for a NYC bailout when the value dropped.

  11. Really sad. We will need to let a lot of people go at my job as well (and we in the management team will be taking a yet-to-be-decided pay cut). Truly terrible. Lets all hope that the coronavirus situation gets a bit better within 60-90 days and things can open up for the summer season. If not, I cant see how many businesses will survive and recover. Think that just four weeks ago my biggest concern was that my reserved rental car wasnt available instantly when I arrived a bit early at my destination…

  12. @Jr – did I say “salary”? No, I said “total compensation”.

    News flash – salary cash is a small percentage of any CEOs compensation. In this case, it was 10% of his last year.

  13. Seems a bit too convenient for me. Are they just taking advantage of the situation I wonder? It’s a corporation so I wouldn’t put anything past them for that. I feel terrible for the employees. It’s so unfortunate when a company goes to slaughter their employee base as the first action.

  14. Furloughed Marriott worker here, and I can tell you that it’s a pretty crummy time for our industry. Hotels running single digit occupancy with limited services for our guests, just doing enough to keep the lights on for an unknown amount of time. Some hotels are closing, while others like mine, are working with a skeleton crew. Only a lucky handful of people still have hours and with that they bear the burden of being the ones fortunate to be picked to keep working while the rest of their teams and colleagues have to turn to unemployment. It’s paramount that people take this seriously for hotel workers, restaurant workers, and everyone else out there whose ability to pay bills and put food on the table is impacted by this unprecedented event.

  15. I am a Marriott employee. I am going to tell you at my property, we’re looking at around 60-75% of all staff being furloughed for a minimum of 3 months. It is most likely going to be the same at all Marriott properties worldwide.

  16. @Donato: It doesn’t matter if everyone is able to claim unemployment or not. The fact is, just being laid off causes undue stress and anxiety, not just for the person, but his or her family. Not to mention the fact that with so many being laid off everywhere, the long lines to sign up for benefits causes even more stress. And then there is the uncertainty of not knowing when–or even if–they will get their old jobs back. And then there is greatest of fears of the coronavirus itself (either you getting it or a member of your family).

    As I said above, all of these people losing their jobs deserve our best wishes and hopes that they are able to get through this.

    And btw, this article is about tens of thousands of people losing their jobs, not about Marriott (and the other hotel chains as well as the airlines) asking for a bailout. Further, this is not about anything bad that Marriott has done. This is a worldwide crisis that is out of everyone’s control.

  17. @[email protected] what does that have to do with anything? I still think guest service wise Hilton, overall, treats its customers better than Marriott. Marriott is only looking to care about the top 1 percent.

    Also, during this epidemic, Hilton is taking a more proactive, customer friendly approach while Marriott is taking a reactive, not as customer friendly approach.

  18. @ GSBEWR
    The post was about the people affected and not about Marriott or any other firm or their culpability. Indeed.
    I still don’t understand asking our government to rescue or help one firm or one giant industry without doing this to any industry affected by this pandemic. I feel, I really feel for the employees but that is life. By the way, I dealt with this in a very painful way and I was an independent contractor, no benefits!
    Why should their job or firm be rescued while millions in retail are not?

  19. @Brian
    @John Smith

    Sorry for the huge layoffs you guys are having to suffer through
    the next couple of months. Yesterday, my son was laid off from
    the corporate-owned Hilton San Francisco Union Square Hotel.
    9% Occupancy yesterday. Do either of you have any knowledge
    of corporate-owned Marriott properties in San Francisco? He’s
    thinking about leaving the Hilton and attempting to land a job at
    a corporate-owned Marriott in San Francisco when the furlough is
    finally over with. I know it’s a longshot. but figured I’d ask. He works
    in purchasing and is not an executive, though working to advance
    into management.

    Any knowledge or advice offered is greatly appreciated.

    Thank you..

  20. @jason29
    I unfortunately don’t. If he’s already in San Francisco I’m sure if he asked around enough he’d find out but I’m DC area so I don’t really have contacts out west.

  21. @John smith
    Thanks John. Best of luck to you, and I hope the industry rebounds as best it can when we start to get things under control.

  22. Unrelated. Just a thought. If you aren’t getting that haircut or color, pedicure, etc. Pay your hairdresser, personal hygiene, manicurist so that they can keep their salon open.

  23. So they are taking pay cuts of 50% at the same time as receiving massive bonuses? Arne would have received another $12 million in bonus so hardly taking a pay cut! Marriott bonus was paid last week to key management in America, Asia and Australia. They are taking the ordinary wages earner to the cleaners.

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