Category Archives: Employee Benefits

Hospitality Industry Legal Update: “Why Union Leaders Want L.A. to Give Them a Minimum Wage Loophole”

“Some see thinly veiled self-interest at work in labor’s quest for waivers in minimum wage laws. Glenn Spencer of the U.S. Chamber of Commerce said that Southern CaliforniaLA minimum wage in particular shows the potential benefits of such provisions for private-sector unions at a time when many are struggling to stanch long-term declines in membership”

One of the most divisive issues that Los Angeles City Council members expect to confront when they return this week from a summer recess will be a proposal by labor leaders to exempt unionized workers from the city’s new minimum wage.

The push for the loophole, which began in the final days before the law’s passage, caused a backlash rarely seen in this pro-union city and upended perceptions of labor’s role in the fight to raise pay for the working poor. Union activists were among the most stalwart backers of L.A.’s ordinance raising the wage to $15 by 2020, and argued against special consideration for nonprofits and small businesses.

Rusty Hicks, head of the Los Angeles County Federation of Labor, said the union waiver would be a routine protection against challenges to the ordinance under federal labor law. “This is about staying consistent with previous provisions and crafting something that will withstand legal scrutiny and delay,” Hicks said in May. In California, he added, “we’ve seen every city that has passed a minimum wage include this kind of a provision.”

A Times review of other cities’ minimum wage laws, as well as interviews with labor leaders and legal experts, suggests the truth is more complicated.

Guarantees that organized workers should be allowed to bargain for a subminimum wage appear to have scant legal justification, some experts said. They are not a universal feature of local wage ordinances, in California or other states. San Diego, the largest California city to raise its minimum wage in recent years before L.A., did not include such an exception.

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Hospitality Industry Insurance Update: “Will Workers’ Comp Pay For Medical Pot For Back Pain?”

A workers’ compensation judge (WCJ) found Dr. Reeve didn’t prescribe medical marijuana and concluded that the pot program wasn’t reasonable and necessary medical care as required by workers’ compmedicalmarijuana…the appeals court had found the certification required under the Compassionate Use Act by a person licensed in New Mexico to prescribe and administer controlled substances is the functional equivalent of a prescription.

In a state where medical marijuana is legal, a recent court decision has reinforced a previous one regarding pot prescriptions under workers’ comp. 

Miguel Maez suffered injuries to his lumbar spine in February and March 2011 while working for Riley Industrial in New Mexico.

Maez received temporary disability benefits under workers’ comp. Dr. Anthony Reeve treated him for back pain starting in June 2011 and prescribed medication for pain management. He also referred Maez to another doctor for spinal injections.

During a test required for pain management patients, Maez tested positive for marijuana. Dr. Reeve told Maez that if he was going to continue to take marijuana, he needed to have a license for Dr. Reeve to continue administering other narcotics.

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Hospitality Industry Management Update: “New Year, New Challenges: What Hospitality Employers Need to Know”

As state and federal budget cuts tend to wane, the Department of Labor (DOL) is expected to step up enforcement against hospitality employers in the coming year. restaurant workerBecause the DOL considers the hospitality industry as a “fissured” industry, owners, franchisors, franchisees and management companies should be prepared to deal with inquiries, particularly in the areas of tipped employees and the misclassification of employees.

According the U.S. Bureau of Labor Statistics, the hospitality sector added 321,000 additional jobs in 2014. With all those new employees, as well as the continued addition of jobs we expect to see in coming year, here are our top predictions for labor law issues that will play a vital role in the hospitality industry in 2015.

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Hospitality Industry Management Update: “Assessing the Midterms’ Impact on Lodging”

AH&LA is hopeful that final action on a long-term TRIA extension occurs in the coming weeks during the lame duck session.Vote The Senate passed its reauthorization bill earlier this year on a huge bipartisan vote, but action has stalled in the House.

The new Senate Republican Majority, combined with a larger House Republican Majority, will significantly alter the policy landscape for the business community and the lodging industry, says the government affairs team at AH&LA.

The association anticipates a busy year legislatively that includes smaller, targeted measures getting to the President’s desk and being signed into law, though likely not any grand compromises on issues like immigration or the nation’s fiscal policy. When it comes to issues impacting the lodging industry, here’s what AH&LA expects to come down the pike:

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Hospitality Industry Management Update: “Industry Groups Sue Over L.A.’s Minimum Wage for Hotel Workers”

The two industry groups are seeking an injunction to block enforcement of the hotel wage law, which was approved in September. The measure is set to go into effect in July for hotels with at least 300 rooms and expand a year later to hotels with at least 150 roomsla minimum wage…backers of the measure said it would prevent hotel workers from having to take on second jobs that keep them from seeing their families. They also argued that the hotels in Los Angeles have benefited from the city’s efforts at boosting the tourism industry.

Two hotel industry groups filed a federal lawsuit Tuesday challenging a new Los Angeles law that requires a higher minimum wage at the city’s larger hotels.

The lawsuit from the American Hotel and Lodging Assn. and the Asian American Hotel Owners Assn. contends that the City Council’s decision to impose a $15.37 per hour minimum wage is preempted by federal labor law and therefore unenforceable.

The two groups also say the city is interfering with labor relations and union organizing at its larger hotels. And they voiced fears that L.A.’s ordinance could be replicated elsewhere in the country.

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Hospitality Industry Insurance Update: “Think Your Workers’ Compensation Covers Everything? Think Again!”

Consider the risks involved when an employee travels overseas for work. Courts have often ruled that an injury or illness that an employee suffers while on short term assignment away from home—even if he or she is not working when it occurs—is work-related.workers comp But a basic workers’ compensation policy will probably not cover this type of claim. A foreign workers’ compensation policy will. Although no law requires employers to provide this coverage, you risk paying medical and lost-time costs out of pocket if you do not have coverage and a traveling employee becomes injured.

You might think your workers’ compensation covers all work-related injuries and illnesses. This could prove a costly mistake.

In most cases, workers’ compensation will cover work-related injuries and illnesses. But in certain special circumstances—which might apply to your company—the basic workers’ compensation policy will not provide coverage. This could leave your company on the hook for a costly workers’ compensation claim.

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Hospitality Industry Management Update: “Examining Hotel Labor Costs”

Labor cost is a major expense item throughout all operated and undistributed departments within a hotel. Not surprisingly, the labor-intensive rooms and food and beverage departments have the highest labor cost ratios.labor costs In 2013, labor costs represented 61.1 percent of total expenses in the rooms department and 59.6 percent in the food and beverage department. At the other end of the spectrum, labor costs are less pervasive in the administrative and general (48.8 percent) and maintenance (51.5 percent) departments.

As revenues continue to grow for most U.S. hotels, the combined cost of salaries, wages, bonuses, and payroll-related expenditures has declined as a percent of total hotel revenue. In 2013, labor costs represented 32.3 percent of total revenue, down from a high of 34.8 percent in 2009 but still above the long-run average of 31.2 percent. Labor costs measured as a percent of total revenue run from a high of roughly 35 percent at convention and resort hotels to a low of 22 percent at limited-service and extended-stay properties.

Strong growth in revenue, however, has the potential to mask the struggles hotel managers face to control labor costs. Therefore, it is important to also measure movements in labor costs relative to changes in other hotel operating expenses. While labor cost as a percent of revenue has declined significantly in recent years, labor cost measured as a percent of total expenses has remained relatively constant.

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Hospitality Industry Management Update: “3 Obamacare Decisions for Hoteliers”

Unless the act is repealed, over time employers will realize its effects, both positive and negative.illness(1920x1080) Rather than waiting around, however, employers are already adopting offensive moves to blunt financial impact beyond a certain level, seeking improved productivity through reduced costs and updated methods. 

Despite attempts by health care experts to demystify the Affordable Care Act, some employers remain unsure of how to comply. Their questions are basic and familiar: Who is a covered employer? What type of coverage must be offered? May we keep our 90-day waiting period for enrollment?

While these questions are important, a more urgent imperative looms: The deadline for many employers to comply with the mandated coverage provision of the Affordable Care Act is approaching rapidly. Some smaller companies will not face mandatory coverage decisions until 2016, but for many employers a compliant health coverage program must be in place as early as New Year’s Day 2015.

Critical decisions must therefore be made without delay.

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Hospitality Industry Legal Update: “California Ranks Highest For Workers’ Compensation Costs”

California employers are required by law to have workers’ comp insurance, even if they have only one employee.Workers Comp (NO LOGO) The California Department of Industrial Relations (DIR) imposes assessments on employers to cover the cost of potential workers comp claims. The amount a business pays into the system depends on how many employees a business has and what its total payroll is.

California has been ranked as the most expensive state for workers’ compensation costs, according to a newly released report.

The Workers’ Compensation Premium Rate Ranking Summary from Oregon’s Department of Consumer and Business Services shows that California businesses spend $3.48 for every $100 of payroll issued.

That’s 188 percent of the median cost of $1.85 for all 50 states. California was the third most expensive state in 2012 and the fifth most expensive in 2010.

“California’s workers’ compensation system is incredibly inefficient,” said Jerry Azevedo, a spokesman for the California-based Workers’ Compensation Action Network, which seeks to reduce costs for employers and improve services to injured workers. “It does not do a good job of achieving its goal. For as much as employers pay, they don’t get a lot out of it.”

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Hospitality Industry Legal Update: “Hotel Industry Threatens Legal Action Over New Wage Law”

Supporters dispute claims that the move was intended to help labor groups increase membership and say the higherLA mayor wages will lift working families out of poverty. Under the law, hotels with union workers can be exempted from the $15.37 hourly wage if workers agree…City Hall leaders on Wednesday rejected the criticisms. Councilman Mike Bonin, who advocated passage of the law, questioned the prediction that 533 hotel jobs will be lost in his Westside district.

Ratcheting up their opposition to a new law requiring larger hotels to pay workers $15.37 an hour, representatives for the hotel industry on Wednesday threatened to sue the city over the ordinance.

Standing outside Los Angeles City Hall, hotel operators and business leaders said they are considering a lawsuit based on federal laws. They also released new numbers predicting 1,488 jobs — including at least 140 in the San Fernando Valley — would be lost as Los Angeles hotels lay off workers to compensate for the wage hike.

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