The government’s scheme to subsidise hotel workers’ wages has still not been communicated to hotels and unions as the tourist season gets under way, with both sides expressing frustration at the delay. Hotels and unions expect to receive the scheme today or at the latest on Monday.
The scheme, announced by President Christodoulides as part of a package of measures to mitigate the economic fallout from the Middle East crisis, provides a 30% subsidy on wages for hotel workers in units that operate throughout April 2026. It will be implemented by ministerial decree but on a voluntary basis, meaning hotels will decide whether to adopt it.
Hotels and unions were particularly frustrated given the scale of the businesses involved and the timing of the delay. “We are talking about businesses worth hundreds of millions which need to proceed with their planning and with the tourist season already under way, the employee side remains pending,” industry professionals told Phileleftheros.
During contacts with the Labour Ministry, hotels proposed increasing the subsidy from 30% to possibly 50%. Unions, for their part, called for equal treatment between Cypriot and EU workers on one hand and third-country workers on the other, to avoid disruption in the labour market.
Finance Minister Makis Keravnos, speaking at the Cyprus Employers and Industrialists Federation (OEB) Board of Directors meeting yesterday, reiterated the government’s position on the subsidy. “For hotels to open in April, the government will grant 30% of employees’ wages,” he said. He also raised an additional scheme to support hotels in hosting Cypriot tourists over the Easter period, if this is deemed to be of benefit to the industry.
OEB President Giorgos Pantelides warned that the impact of the crisis on the tourism sector may prove greater than currently forecast, noting that the sector has been hit in March and April and that May also looks set to be a difficult month. Booking cancellations reached 40% in March, with a similar but possibly slightly lower rate expected for April. “We must all work together to demonstrate in practice that Cyprus was and remains a safe destination,” Pantelides said, adding that the country must also show it is characterised by stability.
Hotels eligible for the scheme must be in operation throughout April. Those opening after 15 to 20 April will not qualify. Under the terms under discussion, hotels receiving the subsidy will not be permitted to terminate employment until 31 October 2026. Workers would receive a government allowance of possibly 30% of their salary, with the employer covering the remainder.
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