Risks Related to Hotel Staffing Shortages and How to Address Them

    The recently shifting economic landscape has created labor shortages across the U.S. and the hospitality industry has certainly not been immune to this shortage. In April 2020 alone, the California leisure and hospitality industry saw more than a 45% decrease in labor. According to a survey from Bloomberg, more than half of U.S. hospitality workers won’t return to their old jobs as the economy rebounds, and over one-third don’t plan to return to the hospitality industry at all.

    As travel begins to open back up and hotels see an increase in traffic, employees have been asked to work in different roles and take on additional responsibilities. The same employee in charge of the front desk could potentially be cleaning rooms or handling valet services.

    Not having a full team of workers opens hotels up to new risks. If there are not enough employees to complete all the necessary tasks, hotels must minimize guest stays and risk losing revenue, reputational damage, and more.

    Hoteliers who are adaptable, focus on the basics and always put the customer first will be more likely to find success in this and any challenging business environment.

    Risky Business

    The risks related to staffing issues can lead to expensive situations that can irreparably damage a hotel’s reputation, lead to guest injury, or worse. If employees don’t have the right training for new jobs, mistakes will occur, and accidents can happen. For instance, a hotel front desk employee stepping in to help with housekeeping could quickly mop up a spill on the floor and not know to display a “caution wet floor” sign. This oversight could create a slip and fall risk for guests and other employees.

    Accidents such as this can leave hoteliers open to insurance claims and costly litigation. Some of the more common insurance claims that hoteliers often see when working with limited staff include slip, trip, and fall accidents, valet accidents, and property damage.
    Fortunately, hoteliers can reduce new risk exposures related to staffing issues. First, hoteliers should work with their agent or broker to ensure they have a good insurance program in place. It can be beneficial to work with a specialty insurer who knows the industry. Many insurers can not only provide competitive coverage, they can also help hoteliers understand their unique risks and offer customized risk mitigation solutions. In fact, there are a number of things hoteliers can do to mitigate risks to their business as a result of the staffing shortage and changing economy.

    Making the Guest a Top Priority

    All hoteliers can agree that one constant in this shifting environment is that the guest experience should be the top priority. If a guest is expecting an advertised service, such as valet parking or spa availability, and that service is not available, it could lead to a negative customer experience. A negative guest experience is one of the most potentially damaging things for a hotel’s reputation. Not only is there a risk of losing future business with that individual, but the guest could leave a bad review, warning other future guests away from the hotel.

    Transparency and clear communication are key in setting guest expectations and providing a comfortable stay during a time when limited personnel can also translate to limitations on guest offerings.

    For instance, if the restaurant, pool, or spa is only open during certain hours, hoteliers should clearly post those hours on signage throughout the hotel, as well as on the website, social media, and the hotel TV channel. In the era of contactless check-ins, hotel management and staff should ensure that guests know who to contact in the event of an issue with their room or an accident/incident occurs. Hoteliers should post the number to the guest helpline throughout the room and prominently display it within the check-in details.

    If guests know what to expect ahead of time, they can plan to make the most of their stay and are more likely to have a positive experience.

    Getting Back to the Basics

    As employees are asked to take on more responsibility and don different hats, it is more important than ever for hoteliers to get the basics right. This means not letting safety fall to the wayside and focusing on good employee communication and training.
    Training can make or break a hotel experience for the guest. For example, employees who work in the restaurant should be trained on how to safely handle food and anyone working the valet services should take driver safety courses.

    As workers are shuffled into new roles, hoteliers should implement comprehensive onboarding training programs. While these programs are critical, they can only go so far without regular drills for employees, evaluations, and adjustments to keep policies and procedures up to date.

    Internal communication is just as important as communicating with guests. If employees have a clear understanding of the work that needs to get done, the hotel is likely to operate more efficiently and guests are sure to have a better experience. A good way to ensure that everyone knows their role is by implementing a daily checklist protocol outlining tasks and those responsible for completing the tasks.

    Thinking Outside the Box

    Hoteliers who have gotten creative, have uncovered ways to adapt and turned challenges into opportunities. One hotel in New York City gave staff members fitness machines when they returned to work, while another chain of resorts in New Jersey and New York offered employees free room and board, along with training programs for those looking to expand their skills into areas such as accounting and marketing.

    Here are some ways that hotels can utilize creativity to make-up for labor shortages:

    • Contactless Check-In
      While growing in popularity in part for health and safety reasons, contactless check-in allows guests to check in to the hotel without someone at the front desk, freeing staff to fulfill other duties.
    • Grab-and-Go
      If there are limited staff in the hotel restaurant, consider creating to-go bags, setting up a grab-and-go station or offering extended delivery and/or room service hours.
    • Utilize Technology
      Virtual concierges, chat boxes, and mobile apps are all helpful and existing technology that can free up staff to do other things.
    • Housekeeping
      Offer guests who stay more than one night and forego room cleaning services a small discount or extra loyalty points.

    In an environment where it is increasingly difficult to hire good people, retaining quality staff members must be paramount. These team members need to feel appreciated. To ensure employees are not under too much strain and comfortable at work, hoteliers can consider informal feedback programs, like a monthly lunch with managers or simple suggestion box. Hoteliers can improve worker morale through positive incentives like a “Cheers through Peers” program where employees can give each other shoutouts for good work. Other helpful incentives can also go a long way toward boosting employee wellbeing and job satisfaction, such as bonuses, childcare aid, and tuition reimbursement.

    Running a hotel on a skeleton crew can be daunting and exhausting, but by getting creative, nailing the basics, and protecting themselves with insurance coverage, hoteliers can still provide an excellent customer experience and find success. 

    The information contained in this material is for information purposes only. This material should not be relied on or treated as a substitute for specific advice relevant to any particular circumstances. Appropriate steps to manage any of the risks described herein will vary depending on particular circumstances. Policy terms and conditions differ. Nothing contained herein guarantees coverage will be afforded under any given fact scenario or policy language.

    This material should be considered in addition to all other relevant information, including the advice of professional advisors, best practices suggested by health and safety organizations, and the requirements of any applicable policy of insurance.

    John Welty is the president for SUITELIFE Underwriting Managers. SUITELIFE Underwriting Managers is a series of RSG Underwriting Managers, LLC, a Delaware limited liability company based in Illinois. RSG Underwriting Managers, LLC, is a subsidiary of Ryan Specialty Group, LLC (RSG). SUITELIFE Underwriting Managers works directly with brokers, agents, and insurance carriers, and as such does not solicit insurance from the public. Some products may only be available in certain states, and some products may only be available from surplus lines insurers. In California: RSG Insurance Services, LLC (License #0E50879). ©2021 Ryan Specialty Group, LLC