Booking.com to cut thousands of workers in new reorganization
Booking.com on Thursday that it will be slashing nearly three thousand jobs globally as it plans to outsource nearly all of its customer service operations. The Dutch company has 14 customer service centers worldwide, and in the coming months will transfer 12 of them to Majorel. Booking.com will shed at least 2,700 workers in the process, who will be given the opportunity to initially join the Luxembourg-based customer service outsource firm that already employs nearly 67,000 people worldwide.
“Booking.com will retain its internal support centers in Amsterdam and Manchester (UK),” Majorel wrote in a statement. “This will enable Booking.com to focus more heavily on strategic areas of competitive advantage, while continuing to deliver world class customer and partner support.”
Customer service employees told NL Times they found out in a video message from Booking Holdings CEO Glenn Fogel that they can go work for Majorel, or they will effectively lose their jobs. Most of those who accept the transfer will get a six-month contract, but there was a lack of clarity about the consequences of refusing the transfer. Those who remain with Booking.com in Amsterdam and Manchester will handle the most complicated customer service issues, and may provide assistance to other teams within the company. The announcement was published on the hotel booking platform’s internal social media site. It is the second mass layoff by the company in two years.
Many staff members expressed concern that they will lose out on severance packages if they refuse to work for Majorel, even though that company will only provide new short-term contracts to staff members who have been with Booking.com for years. Some fear that the Luxembourg-based customer service firm will bounce workers around from one client to the next, and attempt to force them to work in other countries for a lower wage, and without any recourse to fight the decision.
Fogel said he wanted the company to be able to nimbly scale up its use of customer service workers during busy periods, and scale down when those workers are no longer needed. Booking.com currently employs about 5,000 customer service workers, over a third of its workforce. The company had 17,500 employees when it said it would slash 4,000 jobs in August 2020 less than six months after the coronavirus pandemic started in the Netherlands. A thousand of the laid-off workers were based in the Netherlands.
During the pandemic, the company reportedly accepted 100 million euros in State aid, including 65 million euros from the Netherlands. It then awarded tens of millions of euros in compensation package to a small number of executives at its U.S. holding company, sparking an uproar that prompted Booking.com to say it would repay the money it took from the Dutch State. Prior to the coronavirus pandemic, the company posted a profit of 4.6 billion euros in 2019.
A spokesperson for the company brushed off concerns about job security, telling NL Times that those who agree to work for Majorel will receive a minimum half-year contract beginning in the second quarter of the year once the transfer is completed.
Expensive new ad campaign focused on flexibility
The hotel reservation platform recently launched a new ad campaign in the United States featuring Idris Elba. The ad campaign will include a 30-second spot which will air during the fourth quarter of the Super Bowl this Sunday, when the NFL will crown its American football champion. Broadcaster NBC earned an average of 6.5 million dollars for 30 seconds of advertising during its Super Bowl programming, with several companies shelling out 7 million dollars.
“You can feel there’s a tremendous amount of desire to travel right now,” Fogel said in an interview with CNBC. “We think this is a great time to reintroduce Booking.com and bring forward this lighthearted idea of travel.” He said the goal of the campaign is to show off the company’s flexibility with its customers. “Providing flexible booking so people can absolutely feel comfortable making the booking is really important, and that is a message we’re going to be putting out over and over again in this campaign as we roll it out.”
Contrarily, several Booking.com staff members told NL Times that outsourcing the entire customer service department will have a detrimental effect on its ability to assist customers and handle their complaints. Many staff members already feel as if they have to spend an extensive amount of time fixing mistakes made by outsourced customer service workers, one employee said.
“Delivering outstanding support to our customers and partners 24/7 will remain vitally important to our business,” said Paul Downham, the Vice President for Customer Service at Booking.com, in a statement released on Thursday. “We believe that working with the team at Majorel and leveraging their industry-leading customer experience expertise is the best way to ensure we continue to meet our customers’ and partners’ needs as we further expand the diversity of offering on Booking.com across multiple travel products and services.”
Majorel is also traded on the Euronext stock exchange in Amsterdam, and employs workers at offices in Amsterdam and Maastricht. “The new partnership agreement is expected to commence in the second quarter of 2022 after the transfer of the service centers from Booking.com to Majorel takes place, which is subject to customary closing conditions, including regulatory approvals and completion of works council consultations,” Majorel said in a statement.