Evaluate the impact on LT of giving some tour guides an employment contract with a guaranteed number of tours per month.

Mark scheme

Marking points from the official mark scheme (May/June 2023). The mark or mark type is shown in brackets.

1. [K] Meaning of contract – an agreement between two parties
2. [K] Meaning of employment contract with guaranteed hours/number of tours
3. [K] Generic advantages of employment contracts, such as certainty of wages, security, ties employee to the company to some extent, but also commits the company to terms.
4. [APP] The guides are taking customers on sightseeing tours, probably a few hours or full days, but possibly longer.
5. [APP] Customers may choose street food or shopping tours, guides may specialise.
6. [APP] The guides have the responsibility of making all the relevant bookings of transport and other arrangements.
7. [APP] Some of the guides will have very specialist knowledge about places and may take customers to places they would not usually go with standard tours.
8. [APP] The new small group tours for cruise passengers are planned to go every week, so more regular work for guides.
9. [APP] There may be competition for the services of guides in many popular destinations.
10. [AN] Guides will have some certainty in terms of their hours and also possibly which tours they will be taking which will allow for more effective planning leading to reliability of service and higher customer satisfaction.
11. [AN] Also maybe better relationships with suppliers such as vehicle hire, attractions and hotels.
12. [AN] Guides will offer a better service to customers, maintaining high satisfaction level.
13. [AN] Regular business and leisure travellers will be encouraged to use LT for future travel arrangements, due to building a relationship with guides, encouraging increased repeat sales.
14. [AN] LT will be more likely to retain a skilled group of guides, who will be less likely to defect to competitors leading to lower recruitment costs.
15. [AN] There could be a negative impact on the motivation and loyalty of some guides who are not offered the contracts.
16. [AN] If guides have contracts and there are not enough bookings, LT will still have to pay them, therefore negative impact on profits.
17. [EVAL] The reasons for choosing the guides to offer contracts to must be transparent, maybe even with an application process, so that an 'us and them' problem does not arise.
18. [EVAL] The positive impacts on LT will depend on the level of bookings matching the contracted tours/hours.
19. [EVAL] The travel industry is highly sensitive to external factors, such as political instability in countries worldwide.
20. [EVAL] Some guides may also like the current flexibility and will not want contracts.
21. [EVAL] LT will lose some of its operational flexibility if some guides have these contracts.
22. [EVAL] Overall justified judgement on good/bad for LT.
23. [EVAL] The success of Kanon's plan will depend on all of these and possibly other factors, as will whether this will be the right final decision.