Hospitality Labor and Employment Law Blog

Hospitality Labor and Employment Law Blog

Category Archives: Hospitality

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Tip-Related Wage and Hour Issues for the Hospitality Industry in 2015

Our colleague Jeffrey Ruzal at Epstein Becker Green recently wrote a Take 5 newsletter focused on the hospitality industry: “Tip-Related Claims Will Continue to Be Served Up as the Lawsuit du Jour Against the Hospitality Industry in 2015.”

Following is an excerpt:

The hospitality industry is particularly fertile ground for a wide variety of wage and hour issues, which continue to plague management through steadily increasing federal and state department of labor investigations and enforcement actions and the seemingly endless onslaught of private wage and hour lawsuits filed by an overzealous plaintiffs’ bar. Tip credit claims are government regulators’ and … Continue Reading

As Marijuana Becomes Legal in More States, How Should Employers Handle Positive Drug Tests?

By:  Jordan Schwartz

Due to the ever changing laws surrounding the legality of marijuana, many of our hospitality clients have recently asked us whether it is lawful to terminate an employee who has tested positive for marijuana.  The answer varies greatly depending on the state in which you are located.  

States continue to pass legislation legalizing marijuana use for specific purposes.  On July 5, 2014, New York became the twenty-first state along with the District of Columbia to legalize marijuana use for certain medical conditions—joining Alaska, Arizona, California, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nevada, New … Continue Reading

Will California Restaurants Have To Provide Seats To Hosts, Hostesses And Line Cooks? Will Hotels Have To Provide Seats To Their Front Desk Staffs?

By Michael Kun

Several years ago, employees in California began filing class action lawsuits against their employers alleging violations of the “suitable seating” provision buried in the state’s Wage Orders.  The unique provision requires some employers to provide “suitable seating” to some employees when the “nature of their work” would “reasonably permit it.” 

The use of multiple sets of quotation marks in the previous sentence should give readers a good idea just how little guidance employers have about the obscure law.  

The California Supreme Court is now poised to explain what that obscure law means for those employers who … Continue Reading

OCAHO Continues to Enforce Form I-9 Violations in Hospitality and Construction Industries

By Matthew S. Groban and Robert S. Groban, Jr.

The OCAHO has recently issued two Form I-9 enforcement decisions involving hospitality and construction industry employers that should be of interest to all our clients.

In United States v. Symmetric Solutions, Inc. d/b/a Minerva Indian Cuisine, 10 OCAHO no. 1209 (OCAHO February 6, 2014), an OCAHO Administrative Law Judge ("ALJ") upheld a $77,000 fine imposed by Immigration Customs Enforcement ("ICE") against a restaurant in Alpharetta, Georgia ("Restaurant"), for Form I-9 violations. ICE claimed that the Restaurant failed to prepare/present Forms I-9 for more than 80 employees, failed to ensure that several … Continue Reading

Passing Credit Card Swipe Fees to Employees and Guests

 

By Kara Maciel

Our national hospitality practice frequently advises restaurant owners and operators on whether it is legal for employers to pass credit card swipe fees onto employees or even to guests, and the short answer is, yes, in most states. But whether an employer wants to actually pass along this charge and risk alienating their staff or their customers is another question.

With respect to consumers, in the majority of states, passing credit card swipe fees along in a customer surcharge became lawful in 2013. Only ten states prohibit it: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, Oklahoma, … Continue Reading

Playing with Employees’ Hours Could Get You in Hot Water under the ACA and FLSA

By:  Kara Maciel, Adam Solander and Lindsay Smith

As the Employer Mandate compliance deadline looms for employers under the Affordable Care Act (“ACA”) and employers are closely monitoring employee hours, it is critical that employers take appropriate and lawful steps to record all hours worked by an employee.  If employers try to play games and manipulate how time records are maintained, they could find themselves in hot water under both the ACA and the Fair Labor Standards Act (“FLSA”). 

In what appears to be one of the first lawsuits challenging how hours are recorded under the ACA, an employee … Continue Reading

Epstein Becker Green to Participate in the 8th Annual National HR In Hospitality Conference & Expo

Epstein Becker Green is pleased to be participating in the 2014 National HR In Hospitality Conference & Expo at the Aria Hotel in Las Vegas on April 28-30, 2014.  EBG is sending two of its hospitality industry experts to represent the Firm, Kara M. Maciel and Jeffrey H. Ruzal.

Kara, a Member of the Firm in its Washington, DC office, is Chair of the Hospitality Employment and Labor Law Outreach Group.  Kara’s practice is concentrated on issues related to the hospitality industry where she has represented national hotel chains, hospitality management groups, restaurants and spas. Kara also counsels employers on compliance … Continue Reading

How Hoteliers Must Comply With WARN

By Kara M. Maciel

When hoteliers are considering purchasing, selling or remodeling hotels, one of the most overlooked issues during the due diligence and planning phases relates to the Worker Adjustment and Retraining Notification Act.

This statute requires covered employers to provide 60 days’ notice to employees, union representatives, state agencies and localities before carrying out plant closings or mass layoffs.[1] Congress intentionally devised WARN to provide affected employees adequate time to prepare for employment loss, seek and obtain alternative employment, and/or arrange for skill training or retraining to compete successfully in the job market.

Accordingly, hotel buyers, sellers, owners … Continue Reading

Arbitration in Multiemployer Withdrawal Liability Disputes

Most unionized hospitality employers have collective bargaining agreements which require contributions to multiemployer pension funds. In recent years, many of these pension funds have slipped into “endangered” or even “critical” status, and employers who have exited these funds have been hit with substantial assessments of withdrawal liability. These assessments often amount to millions of dollars in withdrawal liability.

Many employers are unfamiliar with the complicated procedures for contesting an assessment of withdrawal liability from a multiemployer pension fund. As a result, pension funds win a substantial percentage of litigated cases on procedural technicalities.

EBG partner Mark M. Trapp recently wrote … Continue Reading

Hospitality Employers: Prepare for NLRB Social Media Policy Scrutiny

In a recent Law360 article, "NLRB Social Media Push Looms Large for Hospitality Sector" (subscription required), our colleague Mark Trapp comments on the importance for unionized and non-unionized hospitality employers to review their social media policies.

Following is an excerpt:

With the National Labor Relations Board increasingly interjecting into non-union issues, hotels, restaurants and other labor-intensive hospitality companies need to brace for potential claims and tread carefully when crafting social media policies for employees, experts say.

Over the last few years, the NLRB has been extending its reach — traditionally centered on union or collective bargaining matters — to

Continue Reading

Wage and Hour Update

Our colleague Kara M. Maciel of Epstein Becker Green wrote a wage and hour update in this month’s Take 5 labor and employment newsletter.

Here’s a preview of the five items:

1. IRS Will Begin Taxing a Restaurant’s Automatic Gratuities as Service Charges
2. The New DOL Secretary, Tom Perez, Spells Out the WHD’s Enforcement Agenda
3. DOL Investigates Health Care Provider and Obtains $4 Million Settlement for Overtime Payments
4. Federal Court Strikes Down DOL Tip Pooling Rule
5. Take Preventative Steps When Facing WHD Audits

Read the full article here.

 … Continue Reading

Take 5 Views You Can Use: Wage and Hour Update

By:  Kara M. Maciel

The following is a selection from the Firm’s October Take 5 Views You Can Use which discusses recent developments in wage hour law affecting the hospitality industry.

IRS Will Begin Taxing a Restaurant’s Automatic Gratuities as Service Charges

Many restaurants include automatic gratuities on the checks of guests with large parties to ensure that servers get fair tips. This method allows the restaurant to calculate an amount into the total bill, but it takes away a customer’s discretion in choosing whether and/or how much to tip the server. As a result of this removal of a … Continue Reading

Restaurant Sues Former Chef to Recover H-1B Visa Expenses When He Quits Before his Contract Expired

By: Robert S. Groban, Jr. and Matthew S. Groban

On June 28, 2013, a District of Columbia restaurant sued its former executive chef to recover the expenses incurred to secure his H-1B visa.  See Rasika West End LLC v. Tyagi, No. 13-0004426 (D.C. Super. Ct. filedJune 28, 2013). According to the complaint, the employer entered into a thirty-six (36) month contract with the H-1B employee, and claimed that it would take that long to recover, among other things, funds spent to secure the approved H-1B petition the employee needed to assume the position. The complaint further alleges that the restaurant was … Continue Reading

Oct.10: Data Privacy and Security Webinar – Legal Strategies Amid Growing Liability Threats

We’d like to recommend an upcoming complimentary webinar, “Data Privacy and Security in the Hospitality Industry Webinar: Legal Strategies Amid Growing Liability Threats"  (Oct. 10, 2:00 p.m. EDT), by our Epstein Becker Green colleagues Kara M. Maciel, Robert J. Hudock, Alaap B. Shah,and Adam C. Solander.

Below is a description of the event:

Privacy and security concerns are natural for businesses in the hospitality industry given the growing use of interconnected electronic data systems to manage transactions and customer accounts. Any information system containing credit card information is a natural target for data theft.… Continue Reading

Serving Up More Taxes – IRS to Begin Taxing Automatic Gratuities as Service Charges

By: Kara M. Maciel

Many restaurants include automatic gratuities on guests’ checks with large parties to ensure servers get fair tips. This method allows the restaurant to calculate an automatic gratuity or tip into the total bill, but it takes away the customer’s discretion in choosing whether and/or how much to tip the server. As a result of this removal of a customer’s voluntary act, the IRS has decided that it will separately tax automatic gratuities.

In 2012, the IRS issued a ruling to clarify earlier tax guidance on tips, particularly automatic gratuities, but because restaurants persuaded the IRS to hold off … Continue Reading

ADA Compliance: Implications for Owners and Managers When Acquiring or Developing New Lodging Facilities

On September 18, 2013, our hospitality practice attorneys, Kara Maciel and Mark Trapp, have the pleasure of speaking at the Lodging Conference in Scottsdale, Arizona on key financial and legal issues under the Americans with Disabilities Act impacting hotel owners and managers when acquiring, selling, developing or managing properties. 

Under the 2010 ADA Standards, which became effective in March of 2012, hotels must take steps to remove access barriers for individuals with disabilities. The new federal standards encompass some key changes for hotel owners, operators and developers.   Our Round Table discussion will focus on hot-button issues facing the hotel industry, including:… Continue Reading

ADA Accessibility Notes from the Resort Hotel Association Conference

By:  Kara Maciel

Last week, I had the honor of attending the Resort Hotel Association’s (“RHA”) Annual Conference at The Edgewater Hotel in Seattle.  RHA is comprised of 130 independently-owned resorts, hotels, city clubs and spas in the United States and specializes in insurance programs that address the risks unique to the lodging industry.  For the second year in a row, RHA invited me and my colleague, Jordan Schwartz, to speak on the Americans with Disabilities Act (“ADA”) and public accommodations issues that hotel and lodging operators face. The room was packed and due to constant questions from the … Continue Reading

Court of Appeals Rules NLRB Notice Posting Violates Employer Free Speech Rights

By Adam C. Abrahms and Steven M. Swirsky

In another major defeat for President Obama’s appointees to the National Labor Relations Board (NLRB or Board), the US Court of Appeals for the DC Circuit found that the Board lacked the authority to issue a 2011 rule which would have required all employers covered by the National Labor Relations Act (the “Act”), including those whose employees are not unionized, to post a workplace notice to employees. The putative Notice, called a “Notification of Employee Rights Under the National Labor Relations Act,” is intended to ostensibly inform employees of their rights to … Continue Reading

Epstein Becker Green Releases New Version of Wage & Hour Guide App

We are pleased to announce the release of a new version of our Wage & Hour Guide app that puts federal and state wage-hour laws at employers’ fingertips. To download the app, click here

The new version features an updated main screen design; added support for iOS 6, iPhone 5, iPad Mini, and fourth generation iPad; improved search capabilities; enhanced attorney profiles; expanded email functionality for sharing guide content with others; and easier access to additional wage and hour information on EBG’s website, including the Wage and Hour Division Investigation Checklist  and other resources.  The new version continues to be offered … Continue Reading

EBG’s 2013 Hospitality Labor and Employment Breakfast Briefing Series – Atlanta Office

Epstein Becker Green is pleased to announce its 2013 Hospitality Labor and Employment Breakfast Briefing Series

Where:                                  

Epstein Becker Green                         

Resurgens Plaza
945 East Paces Ferry Road
Suite 2700
Atlanta, GA 30326-1380

Time:

8:30 a.m.- Registration, Breakfast and Networking

9:00 a.m. – Briefing

10:30 a.m. – Question & Answer

MARK YOUR CALENDARS

May 8, 2013

Trade Secrets and Non-Competes for Hospitality Companies


June 12, 2013
Avoiding Wage and Hour Liability in the Hospitality Industry

September 11, 2013
Liability Under Title III of the ADA

October 9, 2013
How to Avoid Liability Through Enforceable Employment  Policies and a Well-Drafted Employee Continue Reading

The NLRB–Organizing by Pop-Up Unions in Break-Out Units

By: Allen B. Roberts

I wrote the February 2013 version of Take 5 Views You Can Use, a newsletter published by the Labor and Employment practice of Epstein Becker Green. In it, I discuss an alternative view of five topics that are likely to impact hospitality employers in 2013 and beyond. One topic involved the potential for labor organizing by pop-up unions in break-out units.  

Despite some perceptions of cohesiveness and political acumen, influence and wherewithal following the 2012 election cycle, labor unions represent only about 7.3 percent of the private sector workforce in the United States, and only 6.6 percent of … Continue Reading

EBG Provides a Wage and Hour Division Investigation Checklist for Hospitality Employers

Epstein Becker Green is pleased to announce the availability of a Wage and Hour Division Investigation Checklist, which provides hospitality employers with valuable information about wage and hour investigations and audits conducted by the U.S. Department of Labor (DOL). Like EBG’s first-of-its kind Wage and Hour App, which provides detailed information about federal and state laws, the Checklist is a free resource offered by EBG.

The Checklist provides step-by-step guidance on the following issues: preparation before a Wage and Hour Division investigation of the DOL; preliminary investigation issues; document production; on-site inspection activities; employee interviews; and back-wage findings, … Continue Reading

Five Actions Hospitality Employers Should Consider Taking to Comply with the Affordable Care Act

By Greta Ravitsky

I wrote the January 2013 edition of Take 5: Views You Can Use, a newsletter published by the Labor and Employment practice of Epstein Becker Green.

In it, I summarize five actions that hospitality employers should consider taking in 2013 as the DOL steps up its audit efforts under the leadership of the reenergized Obama administration,

  1. Assess the Workforce
  2. Choose Whether to “Pay” or to “Play”
  3. Evaluate Existing Wellness Programs and/or Implement New Wellness Programs to Enhance Employees’ Health Profiles and to Avoid or Minimize the “Cadillac Tax”
  4. Understand and Be Ready to Comply with New
  5. Continue Reading

IRS Releases New Affordable Care Act Guidance on the Employer Mandate

By: Kara M. Maciel, Adam Solander, Brandon Ge and Philo Hall

As we blogged about previously, the Affordable Care Act provides unique compliance obligations for hospitality employers, many of whom employ large numbers of part-time and seasonal employees.  On December 28, 2012, the Internal Revenue Service (“IRS”) released a Notice of Proposed Rulemaking (“NPRM”) on Shared Responsibility for Employers Regarding Health Coverage (the “Employer Mandate”) under the Affordable Care Act (“ACA”). The NPRM largely incorporates previously released guidance on the subject (IRS Notices 2011-36, 2011-73, 2012-17, and 2012-58).  Employers may rely on these proposed … Continue Reading

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