For the last few weeks, hotel unions in Nepal are holding a series of meetings. The purpose is to avoid a disaster that the Covid pandemic has forced on the industry. With no tourists for months, hotels stand on the verge of bankruptcy in the Himalayan nation.

The hospitality industry remains the worst affected by the pandemic. Hotels in Nepal shut their shops in March last year when the government had imposed a nationwide lockdown in wake of the Covid crisis. Despite the easing of restrictions in July, the industry is barely surviving.

Six months on, the choices they face now are either complete closure or mass layoffs of their employees. With no immediate relief in sight, the Hotel Association of Nepal and trade unions are trying to find a middle ground to avoid both choices.

“We understand that hotels are in a difficult situation. There are no tourists, and the situation in 2021 does not look good either,” Madhav Pandey, president of the All Nepal Hotel Casino and Restaurant Workers’ Union, was quoted by The Kathmandu Post.

In March last year, when the industry faced the sudden closure, the owners and employees worked out a deal: Equal pay for all, to avoid mass layoff as well as maintaining the financial sustainability of the industry. That deal has expired on 31 December last week.

Binayak Shah, senior vice-president of Hotel Association Nepal said, “The hospitality industry has been affected the most among all the sectors of the economy, but it has not received any support from the government."

Given the miserable financial condition of the industry, the renewal of the same deal is no longer an option. To stay afloat, they are now exploring the formula of ‘No work, no pay.” Under the deal, hotels might retain some of their employees and the rest would be allowed to go.

Luxury resorts and five-star hotels took the double brunt. With few high-end foreign travelers amid the restricted international flight operations, some of them have been forced to let go of all their employees. Tiger Palace Casino Resort in Bhairahawa is one such resort that fired all of its employees in September last year.  

The government data showed 230,085 foreigners entered the country last year; the last time when the country recorded the same number was in 1986.