A STUDY ON CONTEMPORARY HR ISSUES IN HOSPITALITY AND

TOURISM INDUSTRY
SACHIN GEORGE VARGHESE

Roll No: 143902012

Abstract
The purpose of the study is to understand the hr issues in hospitality and tourism industry.
The industry that deliver hospitality and tourism product and services across international
borders to customers in highly competitive and dynamic market conditions presents a range
of organizational challenges. Human resource management (HRM) signify an important tool
for meeting many of these challenges and adding value in organizations. It focuses more on
international HRM.

Keyword: HRM,Hospitality,Tourism,Issues,Employee,Hotel

1. INTRODUCTION
The purpose of the paper is to it tell about the present HR issues in hospitality and tourism
industry. Many business in hospitality and tourism industry - both small and large have trouble
in understanding their human resource and employment relations requirement whichever
country or countries they operate in.
The hospitality industry is certainly no exception and in many cases is more multifaceted than
the average business. It has been constantly estimated that 75% of businesses do not have an
employee agreements and employment related policies & procedures (Lye, 2007).The
worldwide discrimination and sexual harassment claims are increasing in hr division. The
average cost of a claim is $36,500 - $250,000 and recently in one country an employee was
awarded $1,000,000 (Lye, 2007).This comes directly off to the bottom line profit. Workplace
rape is increasing in the hospitality industry and it have witnessed the resultant disturbance bad
promotion for the hotel, restaurant or workplace (Lye, 2007).Workplace nuisance through
employees following, sending emails, voice messages and gifts is becoming more common and
is resulting in increased absenteeism and resignations. Theft of the inventory such as quality
wine, food and equipment is uncontrolled. Misuse and illegal use of the facilities for personal
gain is increasing (Lye, 2007). It has been constantly verified that some staff use up to 3 hours
per day of email and internet facilities for personal gain and to access illegal sites such as hate

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literature and pornography not to mention chat lines. Many hotel and restaurants intentionally
break occupational health and safety rules which is resulting in increased staff turnover, fines
and costly pay-outs to employees (Lye, 2007). Many managers do not know or have the
familiarity in the knowing, how to manage and lead employees. People skills are paramount to
the business success (Lye, 2007). Not having an enough job description and controlling
management behaviors can be a cause of psychological injury resulting in hefty fines not to
mention the process of lawsuit which we have seen take up to 3 years to resolve.

2. REVIEW OF THE LITERATURE

Case Study On: Human resources issues facing the hotel and travel industry in China
In this case study it tells about human resources issues faced by hospitality and
tourism industry in China.. The case study is done on the basis of views from participants, from
hotels, travel agencies, and academic institutions. The discussion was led by Dr Hanqin Qiu
Zhang,associate professor and co-ordinator for the China MSc in the School of Hotel and
Tourism Management, Hong Kong Polytechnic University. There are many human resource
issues facing Chinas hotel and tourism industry (Wu, 2004). The key issue are : the lack of
qualified staff at both operational and managerial levels, high staff turnover rates, the
unwillingness of university graduates to enter the industry, and the gap between what is taught in
school and college and the realities of the industry itself. One of the participants pointed out that
shortage of human resource is the main cause for not recruiting qualified personnel to fill
vacancies (Wu, 2004). In earlier days if a hotel had 300 vacant post there would be 3000
applications but in today's scenario for 300 vacant post there are likely to be around 200
application (Wu, 2004). It mainly because of increase in number of new properties in China.
More properties lead to more demand of employees. In the 1990s many young students with
good education in China believed that hotels provided good working environment and higher
salaries. It was easy for the hotels to recruit high calibre staff with positive attitude during that
period (Wu, 2004). But now the scenario is changed as hotels industry had created some negative
publicity and the emergence of employment in IT and bank Sector. The current fact is that
today's young people with good qualification will consider working for those company which
offer better pay, positions and benefits. (Wu, 2004)
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The same scenario affected in tourism sector also. In China,
the travel sector has been affected with high turnover, particularly, among tour-guides and
middle-level managers and so getting successors are difficult. Other than hotels, travel agency
complain that there is no career advancement training available to them, as main management
look for cost reduction as a higher priority (Wu, 2004). Another problem is the difficulty in
recruiting people to work in travel agency. Earlier travel agent or guide monthly salary used to
be similar or higher in comparison with other industries. In today's scenario monthly salary is
low. Most tourism graduates they prefer to work in banking or IT sector as they pay more.
Travel agencies find it difficult to retain employees because of the low operating cost. (Wu,
2004)
Numerous studies have been conducted about human resource management in multinational
companies. Common challenges and issues like low-pay, shortage of qualified employees, lack
of training and motivation issues are faced by human resource departments all over the world (L,
2010) (Davidson, 2006) (Uma, 2011) (Wright, 2007) (Adler, 2012) (Yu, 1995).
(Yang, 2008) conducted research on the top three major human resources management issues in
the Taiwanese hospitality industry which were service quality, staff recruitment and selection,
and training and development.
Some scholars have noted that the difficulty in finding qualified Asian graduates to meet
international standards is a threat when a multinational company expands in the Asian region
(Doherty, 2007) (Esichaikul, 1998).
(Bagri, 2010) suggested that a significant gap exists between what skills or experiences are
expected from new employees and what is available from employees.
Data from The McKinsey Global Institute reported that 4.9 million university students graduated
in China in 2006, yet only 10 percent had competencies necessary to work in multinational
corporations. Lack of basic education, lack of foreign language skills, lack of interpersonal skills,
lack of a service-oriented mentality, and lack of an attitude toward teamwork were the major
problems among the younger generation of Chinese

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3.Problems Faced by HR in the Hospitality Sector
The hospitality industry is often come up with employee issues, and those working in human
resource are the people who have take care of it. Out of which one is
3.1 Turnover
It is common now a days in hospitality industry. According to a survey by the Bureau of
Labor Statistics, leisure and hospitality has the highest turnover rates with an average between
4.8 and 5.5 percent from February to June 2013. Along with construction, these figures were
constantly among the top two industries. Varied schedules are the likely cause, explains Joe
McInerney, president of the American Hotel and Lodging Association, in an article for the Wall
Street Journal. However, main reason for turnover is less salary.
3.2 Recruitment
With high turnover rate, it is common that next problem faced by HR will be recruiting. So
because of that to find a candidate with proper skills is a challenging task. When industry doesn't
fully assess a candidate, it increases the chance of placing the right candidate on wrong place.
3.2 Training
High turnover also creates lot of problems in training. When the retention is low, management
tends to put new recruit to the industry before teaching them how to do the job properly. High
intense training and less pay sometimes make recruit to leave. The industry will be fully staffed ,
but the service deliver will be improper. Other than that ,the high turnover can raise the chances
of staff moving into management positions before theyre ready. If there are well-trained
manager they can develop first-line employees to.
3.3 Morale

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Hospitality industry not only looks into retention and recruitment, morale is another part for
HR. Low morale creates a large impact in the hotel ,bar, restaurant business because it affects
service standards of the hotel and ruins the reputation of the hotel. The main cause of morale is
unskilled staff, lack of training, stress, and few rewards.
3.4 Non-existent Policies and Procedures
This is very common in small enterprises in hospitality field, hr may find themselves mired
in legal proceedings such as unemployment hearings and employment-related lawsuits. Many
small hospitality industry fail to maintain accurate and current employee documentation. Without
these documents the HR department and the industry may find itself at the mercy of the
courts.HR personnel should know that employment law favours employees to ensure that they
are treated well. So it is better to do documentation process up to date.
3.5 Inexperienced Managers
Nowadays in hospitality industry managers are asked to oversee the department with many
employee. Many managers are not properly trained to be effective but rather they are thrown to
the post without proper experience or management skills. Untrained managers can lead the
department to inefficient, disgraceful employees which inversely effect the company. Managers
when they don't know what they want the employees to do they come more frustrated and it
creates a negativity among employees.
3.6 Harassment Claims
The impact of harassment occur in hospitality business which will affect the staff especially
with ladies. It can happen in hotels ,restaurant etc in any forms. Harassment is a situation where
HR is charged with preventing and resolving the situation. Employees who had gone through
this becomes fearful and unable to perform the duty properly nor the person can concentrate to
provide best service to the guest.HR is charged responsibly with investigating and possibly
firing or relocating involved employees.

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3.7 Theft
Restaurants and hotels generally have expensive wine, unlimited food, and high-end
equipment. Some staff can't refuse to accept the enticement to filch these items from department.
Theft of this type is unfortunately everyday in the hospitality industry and is extremely costly to
the business. Though HR may try to encourage a sense of loyalty in the employees, it often is not
sufficient to improve this cost.
3.8 Safety Problems
Safety issues in hospitality industry has to be taken into consideration especially by HR
personnel .The importance of employees safety to avoid injuries while work has to be taken
care. Most hotels doesn't give importance to safety factor which will create lot of problems and
now it's important for the HR personnel to ensure the safety while working.

4.CONCLUSION
In this study, several conclusion can be drawn . Hotel and tourism industry is developing rapidly,
it seems that human resource challenges are having a negative impact. The major challenges are
employee retention, human resource shortages, shortages of qualified managers. Employee
retention is urgently required in both the industry , to retain the employees certain measures like
training and education can be provided. On the job training can provided for travel sector
managers and supervisor. Empowerment of employees can be done. Proper rewards recognition
can be done to retain a valued employee. While recruiting recruit the right candidate and place
him in right place. Language is another important factor while selecting a candidate.
Opportunities for career development, supportive management, and an inclusive work culture
should all be part a successful retention strategy. Retention is much cheaper than recruitment,
and that would lead to higher levels of service as employees become more knowledgeable and
experienced over time. Pay for performance programs, in addition to results-based performance
management, also contributes to higher employee satisfaction, and therefore, retention.
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