23% of catering establishments confirm they will dismiss employees, 26% might close

In a survey run by the Association of Catering Establishment (ACE), 45.3% said that they do not know if they shall be dismissing their employees, whilst 23% confirmed they will be dismissing some or all of their employees.

“This is corroborated by the sentiment of closure for establishments. Indeed a staggering one fourth (26.3%) of respondents are considering closing their establishment whilst approximately 42% will for now wait and see. Some 23% stated they will remain open,” a statement by ACE read.

Another consequence of the dramatic decrease in sales is the fact that 60% of the establishments reduced their opening hours and/or days, ACE added.

“There are various factors which are leading to such a sentiment. The main two are lack of sales and unsustainable costs. The wage supplement originally helped the industry to survive. However, its mechanism is not working in a way that it can sustain the industry. The industry is known to have a high turnover of employees unlike other sectors. This has led to many employees not being covered by the wage supplements, apart from the fact that the wage supplement had been reduced. All catering establishments claim that less than 35% of their employees receive the wage supplement given the staff turnover, meaning restaurateurs are financing the remaining 2/3rds while enduring eight months of decreased sales.”

Consequently ACE called on Government to start providing the wage supplement to those employed after 9 March 2020 in order to avoid a major disaster in the sector. “The wage supplement, given the unprecedented reduction in sales, is due to go back to its original form.”

The survey highlights that the restaurateurs feel that in order to survive over the winter period, there must be immediate adjustment to the wage supplement.

“The reduction of social distance in line with the propositions of ACE has also been considered as fundamental for the cold months. On the other hand the members claim that voucherers should be in hand at the earliest.”

ACE reiterates that while the budget measures in the outset are very positive, the implementation of it does not seem to be adequate. Consequently, ACE called on Government to act fast in order to safeguard employment and businesses.