the Zack Award from August 7 . HEB chief executive officer Mr. John Harvey said the decision was designed to pass increases on to employees as soon as possible.

Other changes in the Zack Award would be put in draft form and shared with the Bermuda Industrial Union before final agreement was reached, he said.

The announcement came following a meeting yesterday between HEB members, the Southampton Princess, Hamilton Princess, Sonesta Beach, Marriott's Castle Harbour, Belmont and Harmony Club to discuss the awards made last week.

Bermuda Hotel Association president Mr. Steven Barker said both sides were bound to abide by the conditions of the awards. But the wage increases which exceeded the inflation rate in both Bermuda and the United States would have a negative impact on Bermuda's hotel industry.

"Bermuda's major competitors are not faced with such excessive cost increases,'' he said. "They will definitely have an unfavourable impact on the viability of the hotel industry.

"There will clearly be further pressure on the hotels to somehow reduce expenses.'' Wages are to increase by 3.2 percent in each of the first two years and 3.5 percent in the third.