Hotel Law: New Administration - New Policies

In a business as large as a hotel and in a field as broad as the law, there are innumerable legal issues which affect every area of a hotel's operation. For a hotel, the primary legal focus includes their restaurant, bar, meeting, convention and spa areas of their business, as well as employee relations. Hotels are also expected to protect their guests from criminal harm and to ensure the confidentiality of their personal identity information. These are a few of the daily legal matters hotels are concerned with, but on a national scale, there are also a number of pressing issues that the industry at large must address. For example, with a new presidential administration, there could be new policies on minimum wage and overtime rules, and a revised standard for determining joint employer status. There could also be legal issues surrounding new immigration policies like the H-2B guest-worker program (used by some hotels and resorts for seasonal staffing), as well as the uncertain legal status of some employees who fall under the DACA program. There are also major legal implications surrounding the online gaming industry. With the growing popularity of internet gambling and daily fantasy sports betting, more traditional resort casinos are also seeking the legal right to offer online gambling. Finally, the legal status of home-sharing companies like Airbnb continues to make news. Local jurisdictions are still trying to determine how to regulate the short-term apartment rental market, and the outcome will have consequences for the hotel industry. The December issue of Hotel Business Review will examine these and other critical issues pertaining to hotel law and how some companies are adapting to them.

Library Archives

Stacy Kula

Hoteliers seeking alternative sources of funding can put their alcohol licenses at risk if they don't perform the proper due diligence on potential investors before those investors become owners. Every state has its own complex, and very different, statutory scheme that hoteliers need to navigate to ensure that the investor is eligible to be on the alcohol license. This article identifies some of the overarching issues that most states consider when there is a partial transfer of ownership - although the treatment of those issues may be addressed very differently be each state. READ MORE

Michael B. Newman

In the hotel industry, a key amenity at many properties is the service of alcohol beverages in the restaurant or bar. This necessitates some type of license issued by a state local alcohol beverage licensing authority. Many hotels in smaller cities, rural areas, or suburbs, however, share a common predicament of not getting a license for a bar or restaurant at their premises. This article explores options available to a hotel that elects not to serve alcohol beverages in a bar or restaurant. These options include the "mini bar," a self-service dispensing system, or a complimentary service. READ MORE

Jerome G. Grzeca

President Trump made immigration reform a central issue of his presidential campaign, promising to remove all undocumented immigrants from the United States and to build a physical wall along our southern border. While these large-scale plans have yet to be fully realized, the Trump Administration has begun to construct an "invisible wall" through several smaller immigration policy changes that have already had the effect of restricting and slowing legal immigration in our country. These changes have created new challenges for hospitality companies that rely on foreign workers to meet their staffing needs. READ MORE

Robert E. Braun

The hospitality industry has always been responsible for the safety of its guests. The industry is now grappling with its obligation to maintain a safe data environment. Hotel owners, brands and operators face significant challenges as bad actors become more sophisticated and as hotel systems become more complex. Recent legal developments in Europe and in America have created a new set of issues, requiring hotel companies to reevaluate how they collect process and protect information. The hospitality industry must, therefore, reconsider its approach to data security and privacy. READ MORE

Lisa Devlin

High profile events and trends in the last year have made customers planning future events at hotels nervous. Things like the "#MeToo" movement, the Las Vegas shootings, and political and economic volatility have led meeting planners to request new terms in their event contracts. Many of these new clauses, some of which are being recommended by meeting industry groups, are poorly drafted, don't solve the problem that they seek to address, and put the hotel at risk for claims or lost business. READ MORE

Arthur Tacchino

Despite confusing rhetoric from Capitol Hill, the Affordable Care Act (ACA) and its employer mandate is alive and well. Not only that, the IRS is serious about enforcing the mandate and is collecting penalties from employers for noncompliance. Many companies fall short of ACA compliance because they fail to accurately track full-time employees throughout the year. Constant turnover, variable-hour shifts, and seasonality make it increasingly difficult for hospitality businesses to track employees' hours. This article will cover the nuances of ACA reporting and how to stay on top of all the day-to-day change with shift workers. READ MORE

Robert J. O'Hara III

In the context of a hotel acquisition or new hotel construction, there are a myriad of issues that must be addressed, including a tangled web of permits and licenses that must be obtained prior to opening. Perhaps the most challenging license or permit that must be obtained is the liquor license. The difficulty, obstacles and puzzles that must be solved when obtaining a liquor license vary in complexity and intensity depending on the state in which the hotel is located, and in some cases depending further on which county and / or municipality within the state. It can be easy for outside transaction lawyers working on a hotel acquisition for the owner or management company client to overlook the difficulty and potential for delay that obtaining liquor licenses can present. READ MORE

Gerard Hickel

The contractual relationship between an owner and an operator is begins with the negotiation of the underlying management agreement. The tone and evolution of that owner/operator relationship will hinge upon the resolution of the most important issues arising during the negotiation of the management agreement, with the commercial terms establishing the foundation of the financial relationship, and the allocation of liability terms establishing the parameters of the risk relationship. Determining who is responsible for the consequences and liabilities of the hospitality business is, more often than not, the most heated and highly negotiated part of a management agreement. READ MORE

Coming up in February 2019...

Social Media: Getting Personal

There Social media platforms have revolutionized the hotel industry. Popular sites such as Facebook, Twitter, Pinterest, Instagram, Snapchat, YouTube and Tumblr now account for 2.3 billion active users, and this phenomenon has forever transformed how businesses interact with consumers. Given that social media allows for two-way communication between businesses and consumers, the emphasis of any marketing strategy must be to positively and personally engage the customer, and there are innumerable ways to accomplish that goal. One popular strategy is to encourage hotel guests to create their own personal content - typically videos and photos -which can be shared via their personal social media networks, reaching a sizeable audience. In addition, geo-locational tags and brand hashtags can be embedded in such posts which allow them to be found via metadata searches, substantially enlarging their scope. Influencer marketing is another prevalent social media strategy. Some hotels are paying popular social media stars and bloggers to endorse their brand on social media platforms. These kinds of endorsements generally elicit a strong response because the influencers are perceived as being trustworthy by their followers, and because an influencer's followers are likely to share similar psychographic and demographic traits. Travel review sites have also become vitally important in reputation management. Travelers consistently use social media to express pleasure or frustration about their guest experiences, so it is essential that every review be attended to personally. Assuming the responsibility to address and correct customer service concerns quickly is a way to mitigate complaints and to build brand loyalty. Plus, whether reviews are favorable or unfavorable, they are a vital source of information to managers about a hotel's operational performance.  The February Hotel Business Review will document what some hotels are doing to effectively incorporate social media strategies into their businesses.