Today we’re joined by Katarina Railko, a leading voice in hospitality human resources, whose career in travel, tourism, and events has given her a unique perspective on the industry’s most pressing challenge: employee retention. With deep expertise in the Austrian market, she offers a masterclass in turning high turnover rates from a financial drain into a strategic advantage. We will explore the hidden costs that go far beyond recruitment fees, the tangible benefits of investing in a supportive work culture, and innovative strategies that keep top talent engaged. This conversation moves past the theoretical to provide actionable insights on transforming anonymous feedback into meaningful change, the surprising outcomes of flexible work models, and the powerful, yet often overlooked, strategy of maintaining relationships with former employees.
Given that many hospitality roles in Vienna are physically demanding and a significant portion of the workforce has a migration background, what unique challenges does this create for long-term team stability? Please elaborate on how you proactively manage issues like work permit expirations and health-related departures.
This is one of the most significant realities we face, especially in a vibrant city like Vienna where over 70% of our front-line staff in roles like waiting and bartending come from a migration background. The first major challenge is purely administrative but has a huge human impact: the expiration of a work permit. You can have a fantastic, fully integrated team member who, through no fault of their own, is forced to leave. It’s heartbreaking and disruptive. Proactively, we have to be incredibly diligent with our HR systems, tracking these dates far in advance to support any possible extensions. The other side of this is the physical toll. These aren’t desk jobs; they’re incredibly labor-intensive. We see a lot of health-related departures, especially in housekeeping and kitchen roles. To manage this, we focus heavily on ergonomic training, promoting wellness programs, and encouraging an open dialogue where an employee feels safe to say they’re struggling physically before it becomes a critical issue forcing them to leave.
The cost to replace an employee can exceed €10,000, but the impact goes beyond direct expenses. What are the biggest hidden operational challenges a team faces during the two-to-four-month period it takes to onboard a new hire, and how do you measure these productivity gaps?
That €10,000 figure is just the tip of the iceberg. The real damage happens on the floor, within the team, during that long onboarding period. The biggest hidden challenge is the strain on your existing, experienced staff. They aren’t just doing their own jobs; they’re now mentors, trainers, and are often picking up the slack for the newcomer who is still learning the ropes. You can feel the shift in energy; there’s less proactive service and more reactive problem-solving. This “opportunity cost” is immense. Measuring it is tricky, but not impossible. We look at metrics like guest satisfaction scores, which often dip slightly during these transition periods. We also track internal indicators like the amount of overtime logged by the existing team and even the number of small operational errors. It’s a period of decreased efficiency, and while the new hire is learning, the whole team’s productivity is operating at maybe 80% of its potential.
Many hotels use anonymous surveys to gauge employee satisfaction. Could you walk us through the process of turning that feedback into a tangible action plan? Please share an example of a specific change implemented at your hotel based directly on survey results.
Anonymous surveys are a goldmine, but only if you’re prepared to act on what you find. The process is critical. First, we communicate transparently that the survey is happening and, more importantly, that leadership is committed to addressing the findings. Once the results are in, we don’t just look at the numbers; we dive into the written comments. That’s where the real stories are. We then form small, cross-departmental focus groups to discuss the key themes. For example, a recent survey highlighted a widespread feeling of burnout and a lack of work-life balance, especially among our operational teams. The feedback wasn’t just about long hours, but the rigidity of the schedule. Based directly on this, we developed a pilot program for more flexible scheduling options. It wasn’t about a four-day workweek for everyone, but about giving team members more input into their shifts. This was a direct, tangible outcome of listening to that anonymous feedback, and it showed our team we were serious about their well-being.
Stepping away from a rigid 40-hour workweek can increase immediate payroll costs but improve long-term retention. What was the most significant unforeseen benefit and the biggest challenge you faced when introducing more flexible work models? Could you detail how this change impacted team morale?
The decision to increase our team from 180 to 220 people to accommodate more flexible schedules was a huge leap of faith. The biggest challenge, right out of the gate, was the complexity of rostering. It was an administrative headache initially, and we had to invest in better systems and train managers to think differently about staffing. But the most significant unforeseen benefit was the explosion of ownership and teamwork. When people felt they had more control over their lives, they brought a better version of themselves to work. Morale skyrocketed. Suddenly, you had colleagues willingly swapping shifts to help each other out with childcare or appointments, without management even getting involved. There was a palpable sense of relief and gratitude on the floor. That feeling of being treated like a whole person, not just a cog in a machine, proved to be far more valuable for long-term stability than the money we saved by running a leaner, more rigid team.
Maintaining relationships with former employees for potential re-employment is a key strategy. What specific, practical steps do you take to stay connected with talented staff after they leave? Please provide an anecdote of a “boomerang” hire and the value they brought upon returning.
We never see a good employee leaving as a failure; we see it as a potential “see you later.” The practical steps are simple but consistent. We have an alumni network, and we make sure to invite former key employees to our annual staff parties or other social events. It’s a low-pressure way to keep the connection alive. We also make a point of having a genuine, supportive exit interview where we explicitly say, “The door is always open if you ever want to come back.” I have a favorite boomerang story about a front-office manager who left to try a role at a competitor hotel. He was gone for about a year. When he came back, not only did he bring his original skills, but he returned with invaluable insights into our competitor’s operations and service standards. He helped us identify and fix weaknesses in our own guest experience that we hadn’t even seen. His return saved us months of research and gave us an immediate competitive edge.
While luxury hotels often invest heavily in training, others have fewer resources. What are some highly effective, low-cost training and development initiatives, like cross-training, that any hotel can implement to foster career growth and make employees feel valued? Please describe the results you’ve seen.
This is a critical point because feeling valued isn’t about expensive programs; it’s about investment in people. Cross-training is the single most powerful, low-cost tool in our arsenal. It costs nothing but time and a willingness to collaborate between departments. We’ll have a talented bartender spend a week with the concierge team or a host from the restaurant shadow the front desk. The results are threefold. First, the employee gains new skills and sees a clear path for internal growth, which is a massive retention driver. Second, it breaks down departmental silos and builds incredible empathy and teamwork. The front desk understands why the bar is slammed, and vice-versa. Finally, it creates a more agile, resilient workforce that can cover for each other during busy periods or unexpected absences. It directly shows an employee you’re investing in their future with the company, and that’s priceless.
What is your forecast for employee retention in the Austrian hospitality industry over the next five years?
My forecast is cautiously optimistic, but with a major caveat. The hotels that will thrive are those that fundamentally shift their perspective on human resources, moving from a cost center to a value driver. The old model of viewing employees as easily replaceable is dying, and the pandemic accelerated its demise. Over the next five years, I believe we’ll see a widening gap between employers of choice and everyone else. The winners will be the organizations that embrace flexibility, invest in meaningful career paths beyond a single role, and build cultures of genuine appreciation. The demand for labor isn’t going away, so power will continue to shift to the employee. Hotels that fail to adapt and continue to rely on outdated, rigid structures will face a chronic and worsening staffing crisis, while those who truly invest in their people will not only improve retention but will also see it translate directly into a superior guest experience and a stronger bottom line.
