Caribbean resorts up in arms over Booking's stance on fees

Print

Booking.com's plan to take a cut of mandatory hotel fees has landed the OTA in some hot water with Caribbean hoteliers.

The Caribbean Hotel and Tourism Association (CHTA) has taken a hard-line stance against Booking's move to collect commissions on any extra fees guests must pay at a property, with CHTA CEO and director general Frank Comito announcing that the group would urge members to "reassess their use" of Booking.com if the issue goes unresolved.

In a letter to Booking.com earlier this month, Comito said that the CHTA has received "strong negative backlash from our members about the overall policy and in particular regarding assessing commissions on employee tips and gratuities."

According to a CHTA survey, about 61% of the group's member hotels said they assess tip and gratuity surcharges in their billings, with more than 20% reporting that these types of fees are government-mandated charges.

Additionally, around 37% of member hotels report assessing a resort fee, which can vary widely in definition and comprise anything from gratuities and taxes to services like pool and beach amenities, parking and WiFi. The CHTA counts roughly 1,000 hotel and allied members among its membership base.

Gilda Gumbs-Samuel, executive director of the Anguilla Hotel and Tourism Association said, "Part of the issue is that hotels don't all do the same thing. Island to island is different, government to government is different. In many places in the Caribbean, service charges are like the gratuity. And for [Booking.com] to come and put their hand in the pockets of the people on the island trying to earn a living, it's very upsetting."

At the Atlantis Paradise Island in the Bahamas, guests are subject to fees related to gratuity as well as a destination fee and resort fee.

"In our case, a very large percentage of those fees are pass-throughs to third-party contractors or service providers," said Ed Fields, senior vice president of public affairs and public relations for Atlantis Paradise Island. "In our view, this is something that still warrants discussion in terms of what is commissionable and what's not."

In Turks and Caicos, meanwhile, properties are required by the government to charge a 10% service fee, with 100% of that fee remitted directly to employees.

"It's not an optional thing for the 10% service charge to go to the staff in its entirety," said Karen Whitt, vice president of sales and marketing for the Turks and Caicos-based Hartling Group, whose property portfolio includes the Sands at Grace Bay, the Palms Turks & Caicos and the Shore Club on Long Bay Beach. "For a company like Booking.com to come and add a commission on this fee, that means the proprietor has to [make up the difference], because we are obligated by law to pay it."

Moreover, Whitt criticized the abrupt manner in which Booking.com chose to announce and implement its new commission policy.

"They initially came out with their letter on May 15 and said this takes effect June 1," Whitt said. "That's a 15-day notice, and we had no time to budget or plan. Booking.com has told us that Turks and Caicos is one of their top destinations, so it's a bit perplexing that they would not have come to us ahead of time for some kind of a consultation."

A Booking.com spokesperson confirmed to Travel Weekly that the implementation of the new policy has since been pushed back. They said the change will now go into effect in early 2020.

The CHTA, however, told Travel Weekly that Booking.com's new policy is already in effect throughout the region.

Booking.com said in a statement, "We believe in complete transparency, and at the end of the day, resort fees are a bad consumer experience across the board. Properties should set the price wherever they need to be successful, but list that price up front for consumers."

Still, the OTA appears willing to compromise on some fronts, with the CHTA's Comito recently announcing that "Booking.com changed course at our request to discontinue applying commissions to 'destination fees' upon reviewing and understanding their purpose."

The CHTA defines destination fees as supporting destination enhancement, promotion or beautification efforts.

Meanwhile, Atlantis Paradise Island's Fields said he remains hopeful that a similar agreement can be reached regarding service charges and other pass-through fees.

"I don't think that Booking.com would really wish to charge a hotel in a way that causes them to essentially cut into their bottom line simply to pay Booking.com on a gratuity," Fields said. "While it's true that OTAs certainly have been beneficial to the marketplace, the marketplace has also been very beneficial to OTAs. Our product development and investments go toward making more attractive destinations, and that activity benefits everyone. We should be seen as a partner, and I hope we can have discussions in that light."

By Christina Jelski
Travel Weekly
July 31, 2019