Hotel Yak and Yeti announces VRS

February 10, 2006
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Hotel Yak and Yeti, one of the Nepal’s premier five star hotel, has announced voluntary retirement scheme (VRS) for staff wishing to resign from their posts to downsize the staff for the resumption of the hotel, saying the hotel is facing loss.

Speaking at a press conference on Thursday, Surendra Thakuri, spokesperson of the hotel said that employees who are interested to leave the job are offered incentives through VRS.

Speaking on the occasion, Corporate Director of the hotel, P Poddar said that the management had been compelled to adopt this measure after the hotel started operating in loss.

“The occupancy rate of the hotel had not crossed 50 percent, whereas due to slump in arrival of tourists, the management had been offering rooms at rates less than 65 percent of the original cost,” he said. Due to all these reasons, the hotel had incurred an operating loss of Rs 13.9 million in the current fiscal year and Rs 50 million in the last five years, Poddar added.

Poddar, however, said that the hotel would resume operation of 50 percent of its service soon after completion of the VRS scheme. “We hope around 100 of the total 285 staff members will apply for the scheme, which will significantly reduce our operating cost,” he said.

However, hotel employees do not agree with the proposed scheme brought by the management alone. They said that the VRS is brought without their consultation.

“It is our demand that workers applying for VRS be given a lump sum equal to 40 percent of the salary they are entitled to get before retirement,” said Chhabi Pandey, president of Independent Hotel Workers Union of Yak and Yeti.

The union also refuted claims that employees of the hotel had been demanding increment in their wages.

The hotel was closed on December 24 the eve of Christmas.

Yak & Yeti, which started its operation around 38 years ago was Nepal’s largest foreign currency earning hotel for the last 10 years.