Larry Lipman, the chairman of Safestay, intends to transition from human receptionists to automated check-in machines as employees depart due to the effects of Rachel Reeves’s tax adjustments for employers.

According to Lipman, Safestay is forced to adopt automated self check-in kiosks instead of human staff due to escalating expenses post the October Budget announcement. The decision to raise National Insurance (NI) contributions and lower the payment threshold by the Chancellor has led the company to consider phasing out receptionists in favor of automated check-ins under certain circumstances to manage costs and deliver value to shareholders.

Lipman emphasized that the company plans to reduce staff naturally by choosing not to fill vacant positions when employees move on, rather than resorting to targeted job cuts. Safestay, founded in 2006, operates 20 hostels across the UK and Europe and went public on London’s Alternative Investments Market in 2019.

Lipman believes that the tax increases proposed in the Budget, amounting to £3.4bn annually for the hospitality industry, may lead to a negative impact on businesses, potentially resulting in reduced investments and workforce cuts. Concerned with the increasing costs, Lipman stressed the need to focus on automation and expressed frustration over the potential impact on employment levels as businesses are compelled to automate to manage expenses.

He expressed disappointment in the Government's lack of forethought, indicating that the changes may inadvertently lead to a reduction in employment opportunities, which is contrary to the intention of fostering growth and development in society. Lipman also highlighted the challenge of implementing price increases to offset rising costs without adversely affecting Safestay's market position as a budget accommodation provider.

Lipman concluded that there are limitations to adjusting bed rates due to market constraints and consumer affordability issues. He suggested that the Government's approach to tax reforms may not have been thoroughly considered, potentially leading to unintended consequences in the business sector.