MP wants probe into hotel redundancies
AGLASGOW MP has called on the Chancellor to initiate an investigation into a hotel group that is making mass redundancies after using the furlough scheme.
Stewart McDonald, Glasgow South SNP MP, has written to Rishi Sunak branding the hotel group IHG, which owns the Blythswood and Grand Central hotels, actions “morally reprehensible”.
Mr McDonald said the group is intending to use cash from the Coronavirus Job Retention Scheme to pay the notice of staff it is making redundant.
He said this is “morally, and potentially legally, problematic” under the rules of the scheme.
Around 200 staff at the Blythswood Hotel and many at the Grand Central were furloughed when hotels were forced to close during the lockdown.
Mr McDonald said: “For firms to use money they have received through the Coronavirus Job Retention Scheme to pay the notice pay of staff is morally, and potentially legally, problematic given the recent changes made by the Treasury now explicitly prevents employers from using furlough money to pay the severance package of staff.
“The guidance explicitly states that ‘Grants cannot be used to substitute redundancy payments’.
“To receive taxpayer funded support aimed at protecting jobs, only to then announce mass redundancies is morally reprehensible and goes against the goodwill that the CJRS was established for.
“Treasury officials must investigate employers to ensure the money they have received is used to protect jobs and pay wages”
Bryan Simpson, industrial organiser at Unite Hospitality, said:
“The Government Job Retention Scheme was established for the specific purpose of allowing employers to continue paying staff in order to avoid large scales redundancies like these. ”
A spokesman for IHG said: “When the lockdown first started we hoped our industry would bounce back quickly and using the Coronavirus Job Retention Scheme enabled us to keep as many people in Glasgow employed for as long as possible.
“We now know it will unfortunately take time for travel and tourism to return to pre-coronavirus levels with at least one of our Glasgow hotels not reopening until 2021, which is well beyond the lifespan of the CJRS scheme.
We have launched a consultation to resize and restructure our hotel teams which sadly is likely to involve some redundancies.”