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May 21, 2010

Labor & Employment Hospitality Quarterly Update
Five key labor and employment issues hospitality employers need to be aware of this quarter

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Editor’s note: Welcome to L&E Hospitality Quarterly Update, a new communication to help ensure you stay current on important labor and employment developments. Each quarter, we will highlight five key issues you should be aware of and, where applicable, provide you with links to additional information. We hope this helps you to digest some of the biggest issues you may be facing in a way that is relevant to the hospitality industry.

Health Care Reform Becomes Law

On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (PPACA). Less than a week later, Congress passed the Health Care and Education Tax Credit Reconciliation Act of 2010, the Reconciliation Bill that amended the PPACA (collectively the “Act”). Hospitality employers must carefully understand what changes the Act will bring as to how and whether they provide health insurance benefits. Click here to read the Management Alert that provides a good starting point in describing how the Act affects employers and when the various provisions will take effect.PPACA’s requirement that employers provide breaks for nursing mothers is addressed in this One Minute Memo. Moreover, on May 12, 2010, Seyfarth participated in a webinar with the American Hotel & Lodging Association (AH&LA) regarding how healthcare reform will impact the hotel industry. For information about the AH&LA webinar, click here.

*Think you are too small to be affected by PPACA? Think again! Many smaller hospitality employers are not paying attention to these laws because some commentators have reported they only apply to employers with 50 or more full-time employees. That statement is inaccurate; click here to find out why.

EEOC’s Systemic Enforcement Initiative

The U.S. Equal Employment Opportunity Commission Program (EEOC) is undergoing significant change and is re-focusing its efforts on pursuing systemic enforcement litigation against companies, including an emphasis on particular industries. As a result, employers now face heightened scrutiny of their employment practices and are targets of an unprecedented number of EEOC-initiated class cases. The hospitality industry has unfortunately not escaped this initiative. Although the EEOC has not yet revealed which industries it has been and will be targeting, some of the largest EEOC cases filed since the initiative took hold have been brought against hospitality employers. With an Obama-driven budget increase and the EEOC’s renewed vision and plan, the hospitality industry can reasonably expect this trend to accelerate. But employers are not without tools and defenses. For information on these new developments and best practices for employers confronted with governmental enforcement litigation by the EEOC, click here to read our white paper. To listen to a recording of our recent webinar covering this topic, click here.

OFCCP’s New Enforcement Strategies and Tactics

The Obama Administration’s increased enforcement of affirmative action obligations has significantly boosted the burden for employers to demonstrate compliance. Not only has the Office of Federal Contract Compliance (OFCCP) received a generous budget increase, the Agency is adding more than 200 full-time employees to assist with its enforcement initiatives. New strategies and tactics, including more frequent on-site compliance evaluations, requests for additional analyses and new documents, and a continued narrow focus on pay equity, will impact employers now and in the years to come. The hospitality industry has been and continues to be a frequent target. On February 3, 2010, the Center for Corporate Equity released a report on the OFCCP that noted the impressive “record breaking” enforcement results for the agency for fiscal years 2005-2008 (pre-Obama administration), and reported that the food service industry overall was the most common type of employer involved in an OFCCP settlement in fiscal year 2009. For information on the OFCCP’s announced new strategy and tactics, click here to read our Management Alert.

OSHA’s Increased Enforcement Efforts

The Occupational Safety and Health Administration (OSHA) recently sponsored a national summit on worker safety. Among the issues addressed were safety hazards faced by hispanic workers, including housekeepers. Under the Obama administration, OSHA has greatly increased enforcement efforts against employers (e.g., more citations and higher penalties), and hispanic worker safety is a key OSHA initiative. Click here to read an article that discusses the increased enforcement and recommendations on how employers can respond. Additionally, OSHA recently announced that it intends to target employers with ergonomic injuries by issuing citations under the general duty clause (Section 5(a)(1)). The hospitality industry can expect to be a target of these initiatives. Accordingly, it would be wise for hospitality employers to review their history of ergonomic injuries and ensure that safety policies concerning lifting, bending, and stretching are in place and are being enforced. See below for information on an upcoming event on this topic.

Collective Bargaining About to Heat Up

Contract negotiations for hotel employers in Chicago, Los Angeles, and San Francisco, whose contracts expired last year, remain open. Little if any bargaining was done during the winter. The state of the economy has made it difficult for UNITE HERE to have any success in pushing their demands. While it has generally been quiet in Chicago, Local 2 in San Francisco has staged three-day strikes since November at targeted hotels and have urged customers to boycott seven hotels. Negotiations and union activity will likely heat up with the weather (and increased occupancy rates). Given the National Retirement Fund has been certified as “critical” this year, yet another wrinkle has been added to contract negotiations for those employers who participate in that fund. With contracts in nine other cities, including Minneapolis, Washington, Honolulu, Vancouver, and Toronto set expire this year, hotel employers should plan for a long, difficult summer. Hotel employers in these cities should make sure their strike plans are in order. Unlike Las Vegas, what happens in San Francisco does not necessarily stay in San Francisco.

Publications, Speeches and Events

Upcoming

On June 17,2010 at 12:00 p.m. Central, Jim Curtis, Mark Lies, and Meagan Newman of the Chicago office will present the webinar “What the Hospitality Industry Should Expect from the Occupational Safety & Health Administration in 2010 and Beyond.” For more information and to register, click here.

Recent

On May 12, 2010, Seyfarth participated in a webinar with the American Hotel & Lodging Association (AH&LA) regarding how healthcare reform will impact the hotel industry. For information about the AH&LA webinar, click here.

Chuck Walters and Paul Kehoe of the Washington. D.C. office wrote the article, “Expect Increased Government Enforcement of Employment Laws,” which was published in the February 2010 issue of Hospitality Law. Click here to read the article.

Lynn Kappelman of the Boston office wrote a guest column for FoodService East titled “The EEOC’s New E-RACE Initiative Focuses on Pre-Hire Inquiries.”

Minh Vu of the Washington, D.C. office gave a presentation on ADA Title III regulatory and enforcement developments to the American Hotel & Lodging Association’s Committee for General Counsels of Multi-Unit Owners.

We want to hear from you!

Do you want to know more about these or any other topics? Want to see something reported on? Have an idea for an article or webinar? Looking for a speaker for your group? Please feel free to contact your Seyfarth attorney or any Labor & Employment attorney on our website.