At the same time some hotel companies seemed lulled
into a state of complacency. One Los Angeles area hotel
with which I am familiar had assured its owners that the
union really didn't have much to offer employees.
Existing wages and benefits were said to be at parity
with union hotels in the area. When it was discovered
that a majority of employees had signed cards to join
the union, the owners were surprised to learn that the
employees disagreed with management's view of union
affiliation. Union membership would mean a shorter
workday (due to paid meal breaks) and a more extensive
healthcare package, significant improvements in the eyes
of workers (and a significant incremental expense to the
owners).
Hotel labor unions are smarter and better organized
than ever before. The word on the street is that Local 6
in New York is recruiting the best and brightest from
area law school as Business Agents responsible for
negotiating day-to-day grievances with management.
Imagine being the Human Resource Director at a small
city hotel and having to match wits on a daily basis
with a young whippersnapper fresh out of Columbia Law
School.
I recently attended a staff meeting at a Florida
hotel where the general manager warned the catering
sales team to vet clients carefully for possible union
activity. Its difficult to imagine a hotel turning away
meeting business, but apparently organizers from one of
the local unions had booked space in a neighboring hotel
and had attempted to recruit workers from the very same
property.
The labor strikes against hotel companies in major US
markets have made it clear: Hospitality unions wield
considerable clout. And they will only grow stronger.
Consider the key issue in the current rift between
hotels and their workers: The various unions have been
trying to build muscle by lining up uniform dates on
which their various contracts end. Over the long run,
possibly by this decade's end, a national hotel workers
union seems all but inevitable.
Last month, negotiators for Atlantic City casinos and
Local 54 of the Hotel Employees and Restaurant Employees
agreed to a five-year contract that includes a total pay
raise of 28 percent and continues to have the casino
companies pay for health insurance. In the settlement,
the union appeared to give in on the key contract length
issue, dropping its demand for a three-year deal that
would have aligned its negotiating schedule with those
of workers in Las Vegas and elsewhere. The union in
Atlantic City may have lost this battle, but their
struggle is by no means over. This was just one of many
confrontations likely to take place over a long time.
Last month some San Francisco hotels enduring labor
strikes are said to have performed as well as their
nonunion counterparts. For the time being, hotels are
enjoying economic recovery and the pressure is on the
striking worker lacking a paycheck.
These seeming small victories in Atlantic City and
San Francisco should not make hotel companies
complacent. In the long run, a single national hotel
union seems inevitable. And the sum of its parts will be
more powerful.
David W. Heath is principal at Heath &
Company, Hospitality Advisors Inc. in Roswell, Ga.
Declining Membership is Unions’
Achilles Heel
By Ben Goldman
This month, the labor union representing Atlantic
City casino workers agreed to a five-year contract and
conceded the three-year deal it sought. The union lost a
major battle; a three-year contract could have
strengthened hospitality unions around the country by
expiring at the same time as contracts held by hotel
workers elsewhere. The hotel unions’ struggle to
coordinate contract expiration dates will only become
more difficult.
A common expiration date brings to mind the might of
the Teamsters and its hold over numerous shipping and
freight companies. For hospitality unions, however, such
contracts have been elusive. About 30 years ago, I
represented hotels in Washington, D.C., where the very
same labor union similarly sought common contract
expirations, with local unions in New York and Boston.
As today, they would have been able to shut down a
sizable segment of the industry and had more leverage in
negotiations. But the unions were unsuccessful.
After the resolution of the Atlantic City dispute,
settlements in other cities also are likely to favor the
hotels. By settling on a five-year contract in Atlantic
City, hotels emerged victorious on two fronts. First,
the hotels fixed labor costs for the duration of the
relatively long-term contract. Second, by dropping its
bid for what would have been a uniform expiration date,
the union has one less tool to recruit new members.
It’s a big setback that weakens the already
struggling unions. Union membership, dropping steadily
over the years, accounted for roughly 30 percent of the
U.S. private sector workforce 30 years ago and roughly 8
percent today. Declining union membership is a factor
that sparked the effort to secure uniformly expiring
contracts in the first place.
The better terms that the unions might have been able
to win had they successfully negotiated a common
expiration date would have helped them organize
non-union hotels and grow their membership numbers. But
without that growth, convincing hotels to go along with
a common expiration date becomes even more difficult the
next time the issue arises. The unionized hotels will
stand firmer in negotiations because they will have to
continue to keep labor costs under control in order to
compete for guests with lower-rate hotels that remain
non-union.
In effect, the union demands will force hotels—not
the unions—to become more unified and to take a more
aggressive stance. Witness the worker lockout in San
Francisco. Locked-out San Francisco hotel workers flew
to Hawaii to show unity with hotel workers there. The
move aimed to pressure the San Francisco hotels to
capitulate, but was ineffective.
Success breeds success. When the next negotiations
come up, the hotels will know that a united posture will
likely win them favorable terms.
Ben Goldman, a labor relations lawyer in the Los
Angeles office of Squire, Sanders & Dempsey LLP,
heads the firm's labor practice.
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