You are recruiting thousands of employees. What are the main challenges with this, and what are your plans for staff accommodation?
Martin: It’s a big financial drain carrying this kind of payroll because you’ve got to multiply it by at least another 1.7, 1.8 and when you think of the total cost to the company, you’ve got housing, you’ve got insurance, you’ve got food, you’ve got transportation, its just a phenomenal burden for an owner to carry before you’ve even opened up the hotel and it’s churning revenue.
You’ve got to find somewhere for them to live — when it’s 800, 900 you go into the local market and it’s hard work. You can’t take just parts of that building, you have to take all of it up front and that really is a major cost for our owner. We’re out in the Green Community, DIP.
Rupprecht: We have a unit that contains over 1200 people, we have about 50, 60 units in one building for managers who have privileges for apartments, and then the senior executives are looking for housing all over the place. The owner owns the building – we’re owned by Emirates Group.
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Luigi: I’m very excited about mine because we wanted to make it a great lifestyle for our employees. They show up with a suitcase and that’s it. They want to have a nice lifestyle to live in and the expectation is they come to a luxury hotel and [it’s important] they live this kind of lifestyle and portray this kind of lifestyle to our guests, they have to really experience it themselves, so we were very adamant about recommending the right housing to our ownership for our employees.
We ended up going to Al Reef area, it’s less than 30 minutes away, we will provide a shuttle service, they have a swimming pool, and a fitness centre; it’s brand new. It’s not crowded and I think they’ll enjoy that very much. We feel that that’s a good retention point for us to give them a great lifestyle. It’s a good investment.
Pep: We just went to a compound in Khalifa Park where they will have the swimming pool, the gym, grocery shop, we provide transportation to the mosque, to the church, to the shopping area which is actually very close.
In terms of managers we’ve been very flexible, we’re trying to get the best people in the market especially in terms of sales and marketing so if they live in Dubai we allow them to stay here and then commute or if somebody is already in Abu Dhabi we maintain their housing. Nowadays people are more interested in their lifestyle so we have been very flexible trying to get the best candidates.
Mario: Definitely a key factor to attract the best people in the industry is to offer them a range of high quality benefits and staff accommodation is one of the most important components in the decision process for team members to select their employer.
We have shortlisted three options, we are definitely looking for staff accommodation in line with the best available here in the industry in Dubai. Above entry level we give our team members a choice, either to have based on level and position an apartment in our team building or simply to have an allowance so they can stay wherever they want.
In the Hotelier Middle East Salary Survey 2012, 82% of respondents said they thought line staff wages were too low. What are your views?
Martin: You’ve got such a totally different character today that is working in Dubai and Abu Dhabi.
In the past you were having people come from India or Philippines or Sri Lanka that were coming to work over here because there weren’t opportunities for them back home or if there were opportunities, they were not paid well enough. It’s not the case anymore. Today there’s gainful employment in India, Philippines, Sri Lanka and alike and people now have to make a choice to go out and work aboard.
Salaries have not changed significantly in the entire Middle East for many years and I do believe it is time for a censor check and if those respondents are telling you that I would agree with them; it’s time for a change.
We still have some of the highest profit margins in this part of the world and our developers are used to these high percentages, become used to these high percentages, and I think there will come a time where people just simply have to say ok ‘it’s not going to be like that anymore’.
Rupprecht: I find first of all knowledge is power, I do a lot of research and here, the salaries are really all over the place. And I think that’s one of the key issues. You have individual operators here who still have a ‘I give you this and have a nice day and that’s it’.
Here the salaries for a cleaner or entry level, salaries are really AED 950 (US $259) to AED 1600 ($435) for the same job, even within some larger groups here they pay different salaries so I think the issue here is the ones who are really below the belt they should speak up really, on the other hand there’s some who already pay a pretty good fee and treat their staff ok.
I think at the end of the day the way we see it, I’m a firm a believer, salary is not the top denominator of somebody’s decision, even housing is not the top denominator, it’s how you treat your people, how you develop them, how you train them, how you advance them, how you really work with them within their department, that’s the key thing.
It’s not really the salary. Although having said that, hiring 15,000 people or 12,000 people [across hotels in UAE by the end of next year] it’s a buyer’s market, no question about it. But the good news is there is so many people still coming here; we probably went through over 5000 applications over our recruitment weekend so that shows you there is 5000 people coming through our offices just looking for jobs, some are unemployed, some are employed, so is it a buyer’s market or not? There are still a lot of people looking for jobs.
Luigi: I fully agree with what you are saying. Salary of course is important but at the end of the day if the employee feels recognised and feels there is promotion and good opportunities for him, employees tend to stay.
Martin: The good thing about what I said earlier on, the fact that you have now got people that are working here because they want to work over here, you’ve automatically got someone who is career oriented.
So now you’ve got somebody that’s actually looking for career progress so while entry salary may not be all that great at the moment, at least they have something to work towards rather than in the old days they were fixed on a two-year contract and that was the end of the story. Now you’ve got people who say ‘I want to stay and I want to make a career out of this’ and that’s why this open ended contract is extremely important.
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