Hundreds of local staff working at resorts operated by three Maldivian companies, Villa Hotels, J Resorts and AAA Hotels and Resorts, have quit their jobs due to non-payment of salaries and allowances, the Tourism Employment Association of Maldives (TEAM) has revealed.
Based on information from its members, the association estimates that approximately 300 resort workers – the majority from the Holiday Island Resort operated by Villa – have quit in the past three months.
“The situation is alarming,” said Mauroof Ahmed, the secretary general of TEAM, adding that delays and non-payment were common in the resorts owned by the three local companies.
The management of the Holiday Island Resort was unavailable for comment at the time of publication.
The Villa Group – owned by Jumhooree Party leader Gasim Ibrahim – has been struggling after months of government imposed sanctions.
Abdulla Jabir, the owner of J Hotels and Resorts, said the company is facing cash-flow problems, but pledged to settle all unpaid salaries. “We need a little time. This is a difficult time. Even though we are having difficulties in managing cash-flow, we have a lot of assets. We will pay salaries as soon as we can.”
The company is now planning to sell J Resort Kuda Rah, he said.
Ahmed Hamza, a partner of the AAA company and a former opposition MP, told The Maldives Independent that he has not noticed an increase in staff turnover.
“We regularly pay all of our staff. There is a delay in paying service charge. But that will be paid. And any disgruntled staff who’ve left, they would have been paid what is owed,” he said.
According to the 2014 census, some 11,426 Maldivians are employed in the multi-billion dollar industry. In May, TEAM held a rally in Malé calling on the government to set a US$600 minimum wage and to pass a trade union law to allow collective bargaining.
Following the end of the tourism industry’s high season from December to April, tourist arrivals declined by 2.2 percent in June compared to the same period last year. The total occupancy rate also declined by 5 percent on average during the first half of the year whilst the average duration of stay also fell by 0.3 percent.
Mauroof said both the tourism industry and the government have been unable to tackle the issue of non-payment, which was commonplace in the sector.
“While creating an investor friendly policy, the government has neglected the rights of the workers. And the one place you expect to set things right, the Labor Relation Authority, is understaffed and under-resourced,” he said.
Meanwhile, eight room boys at the Holiday Island Resort have been on strike since last Thursday due to delays in paying salaries and allowances.
A room boy, who wished to remain anonymous due to fear of losing his job, said employees of the resort have not been paid service charge for six months as well as the mandatory Ramadan bonus and travel allowance.
“We still haven’t got an acceptable answer from the management. At least a guarantee that they will eventually pay the money would have been nice but their only response was to tell us to resume work again,” he said.
Mauroof meanwhile condemned the management for poor communication and for asking the striking staff to resume work.
“The workers at Holiday Island are acting upon the instruction of TEAM. It is a legitimate strike. The employees had given notice of the strike beforehand to the management. Basically things are out of control and needs to be settled there,” he said.
Gasim last week announced plans to sell off one of Villa’s luxury resorts to get back on track.
After the central bank froze the bank accounts of Gasim’s Villa Shipping and Trading and subsidiary companies in May over US$90.4 million allegedly owed as unpaid rent and fines, Villa advised its 4,500 employees “who find it hard to work with us to rebuild the company again” to resign and promised to pay outstanding salaries at a later date.
Gasim has since announced he will retire from politics when his term as Maamigili MP expires in 2019.
Jabir, the owner of J Hotels, was a former MP of the Jumhooree Party, who later defected to the main opposition Maldivian Democratic Party (MDP). He was imprisoned on alcohol possession charges in early 2014, but was pardoned after six months. He ran for re-election, but lost in the March 2014 polls.
Hamza of AAA was also a former MDP MP.