Dalata CEO Pat McCann has warned that if the government increases the minimum wage in Ireland by 25 per cent, it could force the hotel group to move any future investments to the UK market.
The Irish Independent says that the Low Pay Commission is preparing to deliver a report to the Irish government at the end of July which may see it backing a minimum wage increase from €9.15 to €11.50 per hour.
The idea is supported by unions but for businesses, it will potentially affect future investment decisions due to the concerns they would have on the impact it will have on competitiveness and operations.
McCann said "Everyone would love to pay more, but that becomes very difficult when you consider that it would come on top of all the other costs" and that this issue could be the one that ultimately decides their future expansion plans.
Dalata have pointed to the fact that there is currently a shortage of hotel rooms in Dublin and that when making decisions its investors are its first priority. The hotel group had given a presentation to its investors last month that stated it was expecting to open 750 rooms in Ireland by 2018.
The Irish Tourism Industry Confederation (ITIC) released a report recently which outlined the need for an additional 30 hotels in Dublin by 2020/21.
Dalata continued to expand its portfolio in 2016 after a blockbuster year of acquisitions in 2015, recently confirming the purchases of hotels in Limerick, Dublin and Cork.
