When Bad Things Happen In the Hospitality Industry

By Steven D. Weber Managing Partner, Stark Weber PLLC | April 01, 2018

Bad things happen in all industries.  In the hospitality industry, those bad things may include an alligator attacking one of your guests, a cyberattack, exposing critical guest related information, the theft of important confidential and trade secret information, and more.  Rather than waiting until those or other bad things happen, hospitality industry players should take steps to understand and develop a plan on how to effectively respond to protect its rights and mitigate the effects. 

Among other things, hospitality players should implement policies regarding the preservation of documents, have a team who can quickly and effectively respond to the events, and provide training to the response team, and other key personnel, on how to respond to events.  Finally, hospitality players should understand that taking swift legal action may be necessary to protect its rights.

Know Thy Policies

First and foremost, every hospital player should have policies in place for the preservation of documents, and every employee should receive a copy of the policies and acknowledge that they have received and read the policies.  The hospitality player should understand that federal and state laws may have differing requirements on how and when documents related to an event must be preserved, especially any documents that might be relevant to a lawsuit.  This duty to preserve documents may come into effect sooner than the party realizes and may extend to documents that the hospitality player knew or should have known that related or could have related to that event.

Given the prevalence of electronic documents systems, in addition to policies, it is crucial to have the person with knowledge of those systems take a lead role in working to have all such documents preserved as soon as an event occurs.  That role includes working with all other individuals who may have documents to preserve those documents.  Failure to preserve documents in accordance with the applicable law could have drastic consequences for a hospitality player     

In addition to legal requirements, the preservation of documents may assist in the player's response to the unfolding events.  Insuring that all documents, including, but not limited to, all electronic documents, are preserved after or during an event may protect a hospitality industry player by informing it what went wrong and laying the foundation for a recovery plan.

Where Is Your Response & Management Plan?

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Eco-Friendly Practices: Corporate Social Responsibility

The hotel industry has undertaken a long-term effort to build more responsible and socially conscious businesses. What began with small efforts to reduce waste - such as paperless checkouts and refillable soap dispensers - has evolved into an international movement toward implementing sustainable development practices. In addition to establishing themselves as good corporate citizens, adopting eco-friendly practices is sound business for hotels. According to a recent report from Deloitte, 95% of business travelers believe the hotel industry should be undertaking “green” initiatives, and Millennials are twice as likely to support brands with strong management of environmental and social issues. Given these conclusions, hotels are continuing to innovate in the areas of environmental sustainability. For example, one leading hotel chain has designed special elevators that collect kinetic energy from the moving lift and in the process, they have reduced their energy consumption by 50%  over conventional elevators. Also, they installed an advanced air conditioning system which employs a magnetic mechanical system that makes them more energy efficient. Other hotels are installing Intelligent Building Systems which monitor and control temperatures in rooms, common areas and swimming pools, as well as ventilation and cold water systems. Some hotels are installing Electric Vehicle charging stations, planting rooftop gardens, implementing stringent recycling programs, and insisting on the use of biodegradable materials. Another trend is the creation of Green Teams within a hotel's operation that are tasked to implement earth-friendly practices and manage budgets for green projects. Some hotels have even gone so far as to curtail or eliminate room service, believing that keeping the kitchen open 24/7 isn't terribly sustainable. The May issue of the Hotel Business Review will document what some hotels are doing to integrate sustainable practices into their operations and how they are benefiting from them.