Premier Inn owner Whitbread warns 6,000 jobs at risk as coronavirus crisis hits demand

Credit: PA

The owner of Premier Inn has warned up to 6,000 jobs could be lost as the coronavirus crisis continues to hit demand for hotel stays.

Whitbread, which also owns Brewers Fayre restaurants, issued the bleak warning on Tuesday morning - the cuts could leave up to 18% of the total workforce without a job.

Speaking to ITV News, CEO Alison Brittain said she will "look again" at the plans if the government were to extends its furlough scheme.

Currently 20,000 Whitbread staff are on "flexible furlough" - costing 14% of the group's total UK wage bill which comes in at £9 million each week.

Ms Brittain: "We have now taken the very difficult decision to announce our intention to enter into consultation on proposals that could result in up to 6,000 redundancies for our hotel and restaurant colleagues.

"This is a regrettable but necessary step to ensure that we emerge from the crisis with a lower cost base, a more flexible operating model and a stronger more resilient business."

She told ITV news: "There is nothing about our business which is causing a problem" and stressed there is no evidence of Covid-19 transmission in either the group's hotels or restaurants.

Whitbread also said it is cutting the number of staff in its head office by around 15%-20%.

The group expects the jobs to go by the end of the year.

Credit: AP

But it said the vast majority of its 900 hotels and 350 restaurants would remain open.

It came as Whitbread revealed like-for-like sales crashed 77.6% in the six months to August 27 after the coronavirus lockdown forced the closure of its estate.

The group said hotel sales growth has been strong since reopening, with those in UK seaside and tourist locations almost 80% full in August as more Britons staycationed due to travel fears amid the pandemic.

But demand in London and other city centres remained under pressure, with total occupancy levels at 51% on average last month and sales still 47.3% lower.

In May, the firm secured £600 million of funding using the Bank of England’s coronavirus corporate financing scheme and furloughed 27,000 of its 35,000 employees.

Premier Inns helped accommodate NHS hospital staff between shifts during the height of the pandemic but were forced to mothball 78 sites.