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1. I. EXECUTIVE SUMMARY
In the hotel industry, lodging facilities are frequently defined by the level of
service they provide to their guests. Due to the extensive services and amenities offered
at resort (46.5 percent) and convention hotels (46.0 percent), these property types have
the highest payroll ratios as a percentage of total expenses. On the other end of the
spectrum, limited-service hotels (36.7 percent) and all-suite properties (37.7 percent)
reported the lowest cost ratios.
Across the board, the cost of labor is the biggest expense in all categories of
hotels, even with the advent of select-service properties; hotel developers cannot avoid
the human component of hotel operations.
While managing labor expenses is important, hospitality managers are also aware
that employees are an integral part of the lodging experience. The interaction between
hospitality guests and employees has a dramatic impact on the customer experience and
the success of the business operation.
Therefore, a fine balance must be drawn between cost controls and guest satisfaction.
II. CASE PROFILE
The cost of labor is the biggest expense in all categories of hotels. Even with the
advent of select-service properties, hospitality developers cannot avoid the human
component of hospitality operations.
Labor expenses remained the largest single expense item for hospitality managers,
accounting for 44.6 percent of total operating costs. Consequently, any trend or issue that
could potentially impact labor costs must be taken seriously by hospitality owners and
managers alike. Due to the magnitude of the expense, labor costs and issues have always
consumed a substantial portion of the time and efforts of hospitality managers. Now, with
news of union contact negotiations, changes to immigration laws, and proposed
legislation to increase the minimum wage, hospitality managers are on edge.
III. PROBLEM STATEMENT
In this case, some problem encountered of the hotel management regarding of
LABOR COST CONTROL AND ROSTERING.
 The management encountered of having a low percent in the total revenue
of the hotel.
 Because of reducing of labor cost, the performance and quality of service
of the employee are affected.
 The number of employee and the capacity to do their duty.

2. IV. STATEMENT OF OBJECTIVES
The objectives of this study are the following:
 To know how the hotel management control the labor cost
 To have an idea to solve or to give an action to any kind of problem
regarding to labor cost control and rostering inside of the hotel
 To know what are the strategies of the management to control the labor
cost without sacrificing the quality of performance of the hotel employee.
V. AREAS OF CONSIDERATION
A. INTERNAL FORCES
 It can affect the performance of the employee
 The service and operation of the hotel will also affected
 The fluctuation of total revenue or the sales of the hotel will be
affected also.
B. EXTERNAL FORCES
 The economy will be affected because of cost cutting many are
unemployed.
 Several political and economic factors are brewing that may have a
strong influence on hotel labor costs.
• Union contract negotiations are under way in several major
cities.
• Proposed changes to immigration laws could affect the
ability of hotels to find and retain employees.
• Local and state governments are proposing legislation to
increase the minimum wage.

3. C. SWOT ANALYSIS
Strength
- The hotel will increase the
percentage of total revenue
- Lessen the labor cost
Weakness
- The quality of the operation
of the hotel
- The capability of the
employee to finish their duty
- Because of the poor quality
of service, the guest may
switch to other hotel
VI. ALTERNATIVE COURSES OF ACTION (MAX. OF 3)
The management faced a percent declined in their total revenue; because of this
the management do the following solution:
 Management was forced to reduce their operating expenses in order to
limit declines in profitability.
 Instead of giving money or paying cash to the productivity employee, the
management gives a complimentary to their employee like a vacation trip,
free dine-out or checking-in in the hotel with their families.
 If the percentage of the total revenue of the hotel is too low, the
management will decide to cut their employee and give attention to the
employee who can perform well to their job.

4. VII. ANALYSIS
In analyzing the issue about labor cost, the management do the following:
 Evaluation for the performance of their employees
 They implement the policy for the standard procedure inside the hotel
 Giving a proper training for the flow of the operation of the hotel
VII. CONCLUSION/ RECOMMENDATIONS
The good quality of the service is depending on the employees’ performance.
Having a good performance is depending on the management taking care of their
employees.
The employees have an important part of the success of the operation of the hotel.

5. UNIVERSITY OF PERPETUAL HELP SYSTEM-LAGUNA
Sto. Niño, Biñan, Laguna
COLLEGE OF INTERNATIONAL HOSPITALITY MANAGEMENT
CASE STUDY:
Labor Cost Control and Rostering in Hotel
SUBMITTED BY:
Guelas, Regina M.
H3A
SUBMITTED TO:
Ms. Kathleen Apilado
January 31, 2011

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