The first quarter of 2018 has already stirred up an array of legal matters that employers in the hospitality industry should be conscious of, both in their day-to-day operations and long-term planning. In February alone, the U.S. House of Representatives passed legislation to curb lawsuits focused on the inaccessibility of brick-and-mortar business establishments and a federal appeals court ruled that discrimination based on sexual orientation violates Title VII of the Civil Rights Act of 1964 (“Title VII”). Earlier this month, the U.S. Department of Labor announced a pilot program that will allow employers to avoid potential penalties for overtime and minimum wage violations. In addition, the #MeToo movement continues to be top of mind across all industries, and hospitality employers should be vigilant in their training and employee awareness efforts. Due diligence in change-of-ownership transactions should include labor relations issues, especially with unionized employees.

This edition of Epstein Becker Green’s Take 5 addresses important and evolving issues confronting employers in the hospitality industry:

  1. Will Congress Slam the Breaks on ADA “Drive By” Lawsuits?
  2. Expanding Sex Discrimination Protection to LGBT Employees in the Hospitality Industry
  3. Effective Compliance Training in the Hospitality Industry in the Wake of #MeToo
  4. Transactional Due Diligence Should Include Labor Relations Issues
  5. Voluntary PAID Program Permits Employers to Escape Potential High Penalties for Self-Reported FLSA Violations—but at What Risk?

Read the full Take 5 online or download the PDF.

Our colleague Steven M. Swirsky at Epstein Becker Green has a post on the Management Memo blog that will be of interest to our readers: “NLRB Reverses Key Rulings: Returns to Pre-Obama Board Test for Deciding Joint-Employer Status and for Determining Whether Handbooks, Rules and Policies Violate the NLRA – Assessment of 2014 Expedited Election Rules and Future Changes Also Announced.”

Following is an excerpt:

It should come as no surprise that recent days have seen a stream of significant decisions and other actions from the National Labor Relations Board as Board Chairman Philip A. Miscimarra’s term moves towards its December 16, 2017 conclusion.  Chairman Miscimarra, while he was in a minority of Republican appointees from his confirmation during July 2013 and as a new majority has taken shape with the confirmation of Members Marvin Kaplan and William Emanuel, has clearly and consistently explained why he disagreed with the actions of the Obama Board in a range of areas, including the 2015 adoption of a much relaxed standard for determining joint-employer status in Browning-Ferris Industries, the standard adopted in Lutheran Heritage Village for determining whether a work rule or policy, whether in a handbook or elsewhere would be found to unlawfully interfere with employees’ rights under Section 7 of the National Labor Relations Act to engage concerted action with respect to their terms and conditions of employment, and his disagreement with the expedited election rules that the Board adopted through amendments to the Board’s election rules. …

In Hy-Brand Industrial Contractors Ltd. and Brandt Construction Co., decided on December 14, 2017, in a 34-2 decision, the Board has discarded the standard adopted in Browning-Ferris, and announced that it was returning to the previous standard and test for determining joint-employer status and returning to its earlier “direct and  immediate control standard.”  …

In The Boeing Company, also decided on December 14, 2017, the Board adopted new standards for determining whether “facially neutral workplace rules, policies and employee handbook standards unlawfully interfere with the exercise” of employees rights protected by the NLRA. …

Noting that the 2014 Election Rules were adopted over the dissent of Chairman Miscimarra and then Member Harry Johnson, and the fact that these rules have now been effect for more than two years, on December 14th, the Board, over the dissents of Members Mark Pearce and Lauren McFerren, both of who were appointed by President Obama, published a Request for Information, seeking comment …

Read the full post here.

When: Thursday, September 14, 2017 8:00 a.m. – 4:30 p.m.

Where: New York Hilton Midtown, 1335 Avenue of the Americas, New York, NY 10019

Epstein Becker Green’s Annual Workforce Management Briefing will focus on the latest developments in labor and employment law, including:

  • Immigration
  • Global Executive Compensation
  • Artificial Intelligence
  • Internal Cyber Threats
  • Pay Equity
  • People Analytics in Hiring
  • Gig Economy
  • Wage and Hour
  • Paid and Unpaid Leave
  • Trade Secret Misappropriation
  • Ethics

We will start the day with two morning Plenary Sessions. The first session is kicked off with Philip A. Miscimarra, Chairman of the National Labor Relations Board (NLRB).

We are thrilled to welcome back speakers from the U.S. Chamber of Commerce. Marc Freedman and Katie Mahoney will speak on the latest policy developments in Washington, D.C., that impact employers nationwide during the second plenary session.

Morning and afternoon breakout workshop sessions are being led by attorneys at Epstein Becker Green – including some contributors to this blog! Commissioner of the Equal Employment Opportunity Commission, Chai R. Feldblum, will be making remarks in the afternoon before attendees break into their afternoon workshops. We are also looking forward to hearing from our keynote speaker, Bret Baier, Chief Political Anchor of FOX News Channel and Anchor of Special Report with Bret Baier.

View the full briefing agenda and workshop descriptions here.

Visit the briefing website for more information and to register, and contact Sylwia Faszczewska or Elizabeth Gannon with questions. Seating is limited.

Our colleagues Patrick G. Brady and Julie Saker Schlegel, at Epstein Becker Green, have a post on the Retail Labor and Employment Law blog that will be of interest to many of our readers in the hospitality industry: “Beyond Joint Employment: Do Companies Aid and Abet Discrimination by Conducting Background Checks on Independent Contractors?

Following is an excerpt:

Ever since the National Labor Relations Board (“NLRB”) issued its August 2015 decision in Browning-Ferris Industries of California, Inc., holding two entities may be joint employers if one exercises either direct or indirect control over the terms and conditions of the other’s employees or reserves the right to do so, the concept of joint employment has generated increased interest from plaintiffs’ attorneys, and increased concern from employers. Questions raised by the New York Court of Appeals in a recent oral argument, however, indicate that employers who engage another company’s workers on an independent contractor basis would be wise to guard against another potential form of liability, for aiding and abetting acts that violate various anti-discrimination statutes, including both the New York State (“NYSHRL”) and New York City Human Rights Laws (“NYCHRL”) and the New Jersey Law Against Discrimination (“NJLAD”).

Read the full post here.

A Full Menu of Potential Legal Issues for Hospitality Owner/OperatorsIn the new issue of Take 5, our colleagues examine important and evolving issues confronting owners, operators, and employers in the hospitality industry:

Read the full Take 5 online or download the PDF.

A new post on the Management Memo blog will be of interest to many of our readers in the hospitality industry: “‘A Day Without’ Actions – How Can Employers Prepare?” by our colleagues Steven M. Swirsky and Laura C. Monaco of Epstein Becker Green.

Following is an excerpt:

[T]he same groups that organized the January 21, 2017 Women’s March on Washington – an action participated in by millions of individuals across the county – has called for a “Day Without Women” to be held on Wednesday, March 8, 2017. Organizers are encouraging women to participate by taking the day off from paid and unpaid labor, and by wearing red – which the organizers note “may be a great act of defiance for some uniformed workers.”

Employers should be prepared to address any difficult questions that might arise in connection with the upcoming “Day Without Women” strike: Do I have to give my employees time off to participate in Day Without events? Can I still enforce the company dress code – or do I need to permit employees to wear red? Can I discipline an employee who is “no call, no show” to work that day? Am I required to approve requests for the day off by employees who want to participate? As we explained in our prior blog post, guidance from the National Labor Relations Board’s General Counsel suggests that an employer can rely on its “lawful and neutrally-applied work rules” to make decisions about granting requests for time off, enforcing its dress code, and disciplining employees for attendance rule violations. An employer’s response, however, to a given employee’s request for time off or for an exception to the dress code, may vary widely based upon the individual facts and circumstances of each case. …

Read the full post here.

Featured on Employment Law This Week:  The U.S. Court of Appeals for the Fifth Circuit backs the National Labor Relations Board (NLRB) in an outsourcing dispute.

The NLRB found that a management company violated the National Labor Relations Act when it outsourced the cleaning staff of a hotel that it managed. The NLRB found evidence that the outsourcing decision was related to the worker’s interest in union representation. The NLRB rejected the company’s argument that the decision was due to declining guest satisfaction, concluding that the decision was at least, in part, motivated by anti-union animus. The Fifth Circuit has now rejected an appeal by the company, noting that the court was obligated to pay “special deference” to the NLRB’s credibility findings in cases with conflicting evidence, like this one.

Watch the segment below and see our previous blog post.

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the hospitality industry: “NLRB Acting Chair Dissents Point to Likely Changes to Board Election Rules and Employee Handbook and Email Standards.”

Following is an excerpt:

NLRB Acting Chair Philip Miscimarra has given the clearest indication to date of what steps a new Republican majority is likely to take to reverse key elements of the Labor Board’s hallmark actions of the Obama administration once President Trump nominates candidates for the Board’s two open seats and the Senate confirms. In each of these cases, Miscimarra highlighted his earlier opposition to the majority’s changes in long standing precedents and practices. …

Read the full post here.

Fifth Circuit Pays Special Deference to NLRB’s Determination that Hotel Management Company Acted With Anti-Union Animus In Outsourcing Housekeeping DepartmentA recent decision of the U.S. Court of Appeals for the Fifth Circuit illustrates the potential pitfalls of outsourcing in the face of a union campaign, as well as the steep hurdle employers face in overturning a decision of the National Labor Relations Board (“NLRB”). In Remington Lodging & Hospitality, LLC v. NLRB, the Fifth Circuit enforced an NLRB order holding that a hotel management company’s decision to outsource the hotel’s housekeeping department was motivated at least in part by anti-union animus and therefore violated Section 8(a)(3) of the National Labor Relations Act (“the Act”).

In late 2011, Remington Lodging & Hospitality, LLC (“the Management Company”) was hired to manage the Hyatt Regency Long Island hotel (“the Hotel”). At the time the Management Company took over management, the Hotel’s housekeeping functions had been outsourced to a staffing company. Consistent with its general preference to directly employ its workers, the Management Company brought the housekeeping function back in-house, and terminated the Hotel’s contract with the staffing company.

Unfortunately, the Hotel’s guest-room component score – its primary indicator of housekeeping effectiveness – continued to decline, and by June of 2012 had hit its lowest level. That month, the Management Company contacted the staffing company about re-outsourcing the Hotel’s housekeeping department, and in August entered into a new agreement with the staffing company to do so.

The NLRB held that this second outsourcing was at least partially motivated by a desire to discourage membership in a union that had begun making efforts to unionize the housekeepers around the time the Management Company elected to re-outsource the department.

On appeal, the Fifth Circuit rejected the Management Company’s argument that to prove a violation of Section 8(a)(3) of the Act, the NLRB must produce evidence that the discrimination “in fact caused or resulted in a discouragement of union membership.” As the NLRB had failed to introduce such evidence, the Management Company argued the NLRB’s order was not supported by substantial evidence.

In rejecting this argument, the Fifth Circuit noted that requiring actual evidence of discouragement was “completely inconsistent” with Fifth Circuit precedent. The court stated flatly the NLRB “need not prove discouragement as a matter of fact.”

While the Management Company asserted that the decline in guest-room component scores explained its decision, the court upheld the NLRB’s resolution of this contested issue of fact. The court noted that the NLRB had relied on evidence of two union-related conversations between housekeepers and Hotel supervisors prior to the outsourcing decision, as well as the statement of another supervisor that the outsourcing decision was “because of the union.” Together these constituted substantial evidence of an unlawful motive. Stating that it must pay “special deference” to the NLRB’s resolution of conflicting evidence, the court upheld the NLRB’s order.

The lesson for employers is a familiar one – be mindful of the potential repercussions of outsourcing decisions, and careful when considering and articulating the underlying motivation. Conflicting evidence is enough to find illegal motivation.

A New Year and a New Administration: Five Employment, Labor & Workforce Management Issues That Employers Should MonitorIn the new issue of Take 5, our colleagues examine five employment, labor, and workforce management issues that will continue to be reviewed and remain top of mind for employers under the Trump administration:

Read the full Take 5 online or download the PDF. Also, keep track of developments with Epstein Becker Green’s new microsite, The New Administration: Insights and Strategies.