Labor & Employment: Think Locally, Act Accordingly

A New Mantra in Hospitality

By Dana Kravetz Firm Managing Partner, Michelman & Robinson, LLP | October 01, 2017

The matters weighing on the minds of hotel and resort owners and operators are many: average daily rates, occupancy levels, market penetration, revenue generation, operating costs, growth trajectories, tourism trends, customer service demands, real estate concerns, budget constraints, inventory management, cyber security and effective marketing strategies are a few of the major ones. Labor and employment issues are an unusually significant source of concern for hotel executives as well, demanding a disproportionate amount of their attention given the burdensome legal requirements imposed upon employers.

On the employment front, better days for hoteliers and corresponding trouble for their employees have been forecasted as a consequence of President Trump's imprint upon the Department of Labor and National Labor Relations Board. But the optimistic outlook for hotels and resorts, at least on the national stage, is tempered in many jurisdictions by state and local laws that are decidedly pro-labor. And beyond the enactment of employee-friendly legislation, local activism concerning a breadth of other issues – including hotel privacy – is also impacting the hospitality business. Taken together, it is worthwhile to address two questions of great importance within the industry: notwithstanding the messages emanating from Washington, D.C. that are sympathetic to business, what is happening at the grassroots level that relates to hotel and resort operations, and does local regulation even matter?

State and Local Ordinances

The minimum wage, paid family leave, employee discrimination and safety, tip credits, an employer's right to inquire about the salary history of job candidates, and the ability of police to search hotel guest registers are amongst the focus of ongoing state and local lawmaking that is keeping hoteliers on their toes. A brief survey:

Minimum Wage

In recent years, the minimum wage has been on the rise throughout the U.S. by virtue of ballot initiatives and legislation passed in several states, including Alaska, Arizona, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, New Jersey, New York, Ohio, Oregon, Rhode Island, South Dakota, Vermont, Washington and West Virginia. Minimum wage increases have also been enacted by way of local ordinances in cities such as Albuquerque, Las Cruces, Oakland, Palo Alto, Sacramento, San Diego, San Francisco, Santa Monica, Seattle, Tacoma and Washington, D.C.

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Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.