Scenic Circle Southern Cross executive assistant manager Dylan Rush-brook confirmed hotel staff would start working a four-day week, with staff to use their leave on the fifth day.
The global economic crisis, fewer Dunedin-based conferences scheduled, and clients preferring to book "last minute", meant hotel management had little choice but to review staffing numbers, he said.
"Our staff are aware of the reality of the situation."
While bookings over the summer period were down 1%-2% compared with the previous year, winter bookings "were looking very low", he said.
Hotel management staff, inspired by the nine-day fortnight proposed at the recent job summit, would encourage its 40 full-time staff to move to a four-day week.
Moves to protect full-time jobs would mean part-time jobs, mainly in the housekeeping department, were likely to be reduced over time, Mr Rushbrook said.
The hotel would also move to have staff "on call" to cover any large influx of clients, he said.
He was confident the hotel and the Dunedin tourism sector would survive the economic downturn.
New Zealand Hotel Council chairwoman Jennie Langley said it was the first time she had heard of a hotel implementing a four-day roster, but "it won't be the last".
"This is a great example of a good employer, and is a real sign of things to come."
Tourism Dunedin chief executive Hamish Saxton said it was important for the tourism industry to "look at innovative ways of retaining staff".
