Benchmarked Framework Towards Strengthening the Early Retirement Program for the Hotel Industry in the Philippines
International Journal of Economics, Commerce and Management ISSN 2348-0386), Vol. II, Issue 3, 2014
22 Pages Posted: 23 Feb 2014 Last revised: 16 Apr 2014
Date Written: January 14, 2013
The study primarily aimed to provide a framework through benchmarking on existing early retirement programs (ERPs) for the hotel industry in the Philippines.
To answer the objectives of this study, the researcher used a combination of descriptive and quantitative research as research designs.
The research was conducted only within the Metro Manila area where most of the de luxe class hotels are located. The target subjects of the study are the de luxe class hotels.
The choice of samples for the respondents is based on their knowledge level about the subject matter and the accessibility of the available personnel in the target samples.
As per overall response of the key informants of this study, the implementation of the Management Initiated Early Retirement Program (MI-ERP) is at its strongest in terms of eligibility criteria while the implementation of the MI-ERP is at its weakest in terms of program offerings. Moreover, the hindrance in the implementation of the MI-ERP is at its strongest in terms of employees’ attitude. Evidence reveals that the implemented best practices in terms of early retirement date & processes, program offerings, and administration of the retirement plan have a significant relationship with the problems encountered in the implementation of the MI-ERP in terms of employees’ attitude.
After consideration of all the findings of this study, the researcher proposes a spectrum of conditions of practices governing the management initiated early retirement program (MI-ERP). In case hotels will put up a management initiated early retirement program (MI-ERP), the spectrum will be useful in correctly positioning their ERPs. Analysis of the spectrum further indicates a chance of higher probability of availment of targeted employees whenever a company applies a higher spectrum.
Finally, the researcher made the following conclusions:
1. There is lack of set of guidelines in place for the implementation of the best practices of the MI-ERP.
2. Years of service is the best criteria for eligibility in order to create a broad range of targeted employees. Critical factors which should be emphasized for further improvement involve: careful succession planning with a well-crafted succession plan in place; career counseling to encourage low performers to accept and the high performers to decline; swift processing of the retirement benefits; and capacity to offer the MI-ERP all year round. In terms of program offerings, the same must not only involve monetary (lump sum benefits, healthcare benefits, insurance) but also non-monetary benefits (e.g. send-off gatherings and outplacement seminars). Legitimacy, support, financing and governance are factors for successful implementation.
3. Employees’ attitudes of the targeted population are critical factors that hinder implementation of the best practices of the MI-ERP. Since financial factors are not problems for the implementation of the MI-ERP, employers of the hotel industry are financially capable of allocating a budget for the improvement in the implementation of the MI-ERP.
4. Employees’ attitude can cause a potential problem in the implementation of the best practices of the MI-ERP in terms of early retirement date & process, program offerings, and administration of the retirement plan. This means that employees’ attitude will be a triggering factor for the successful or unsuccessful implementation of the MI-ERP in terms of early retirement date & process, program offerings, and administration of the retirement plan. In this regard, money can be an extrinsic motivator for influencing employees’ attitude.
5. Any hotel organization can develop its own MI-ERP for its employees and the quality of the program may depend on a spectrum of choices based on eligibility criteria, early retirement date & process, program offerings and administration of the retirement plan. Oftentimes, the best practice spectrum may entail investment and fund appropriation, but would result to the ultimate success of the program. On the other hand, the poorly managed MI-ERP would always face numerous challenges such as delays in release of retirement funds to beneficiaries, non-availment of targeted low performers, and others resulting in an overall failure of the program.
Keywords: Early Retirement Program, hotel, tourism, retirement, tourism, hotel
JEL Classification: J63, L83, M12, N45
Suggested Citation: Suggested Citation