Duff on Hospitality Law

Oregon is making history, once again. The new minimum wage law (signed by Governor Brown on March 2, 2016) brings two new titles: 1.) the first state to implement a tiered minimum wage (the amount paid is dependent upon the location of the business); and 2.) the state with the highest minimum wage. The passage of the new law has brought a mixed response. The cheers have emanated from the employees and the advocates for a livable wage. The jeers have emanated from businesses trying to figure out how they are going to keep their doors open. While the law is effective immediately, the first increase goes into effect July 1, 2016. So, without further ado, let’s get to the details so you can determine which camp you are joining. 

Fourteen lawsuits were filed last week against employers at the Seattle-Tacoma International Airport for paying less than the $15 minimum wage approved by Sea-Tac voters in 2013. Defendants include baggage handling firms, rental car agencies, food-service establishments and logistics firms. These lawsuits have been filed by defendants represented by Attorney Duncan Turner of Badgley Mullins Turner and seek class action status. The lawsuits currently cover about 40 plaintiffs, although Mr. Turner estimates this could grow to 1,500 plaintiffs and that total back-pay sought could be $14 to $21 million.

Alaska Airlines and three other plaintiffs had filed a lawsuit arguing that the Sea-Tac minimum wage should not apply to the airport. The State Supreme Court ruled against them in August, 2015, and in December, 2015 rejected a request to review the case.

If you have any questions about these lawsuits, would like to review a copy of one of the complaints, or would like to discuss applicable wage & hour issues, please feel free to contact Greg Duff.

In the latest of a series of twists and turns regarding the legality of certain tip pools in Western states, on February 23, 2016, a divided three judge panel of the Ninth Circuit Court of Appeals validated regulations by the Department of Labor (“DOL”) that significantly limit employers’ ability to have tip pools that include more than “customarily and regularly tipped” employees. This development means that employers operating in states or territories in the Ninth Circuit (covering Washington, Oregon, Alaska, Idaho, Montana, Nevada, California, Arizona, Hawaii, Guam, and the Northern Mariana Islands) cannot include in their tip pools “back of the house” employees (such as cooks or dishwashers) or other employees who are not customarily tipped. We examine the impact of and history behind this decision below.

In a recent blog post, we highlighted the trend amongst hoteliers and restaurateurs toward adopting service charge models to meet the rise in state and local minimum wage requirements. Although “no-tip” and “service charge” policies are receiving their fair share of attention in the news, employers with improperly designed tip pools are garnering their own headlines—and lawsuits. For example, Red Robin recently agreed to a $1.3 million settlement in response to class action claims against the company that it impermissibly included back of house kitchen staff in the servers’ tip pool. If your company requires employees to pool their tips, or is considering doing so, it will want to avoid some common and costly pitfalls that have beleaguered others. For starters: 

As lawmakers continue to increase the minimum wage in states and cities across the country, many hoteliers and restaurateurs are implementing service charges and tip pools in order to meet rising costs and help workers earn consistent and livable wages. If your company is considering making such a move, you will want to do your homework to avoid the negative headlines, legal complications and financial burden that can accompany improper implementation of service charge or tip pool policies. Today’s post will focus on service charges.

This year's HSMAI Lodging Chief Digital Officer Executive Roundtable was held on December 8, 2015 at Washington, D.C.

For those of you who attended, or did not attend the Roundtable, my presentation, "Distribution Parity: Where Do We Go From Here?", is available below. It features an overview of recent worldwide parity developments in the online distribution world.

Feel free to contact me if you have any questions.

Since their official unveiling in December 2014, the FDA’s final menu-labeling rules have given rise to a multitude of questions from hospitality businesses who wonder how to comply or whether they must comply at all. The FDA, in turn, appears to be trying its level best to provide enough time and guidance to ease these businesses’ transition to the new rules. First, the FDA extended the deadline for compliance by a full year from December 1, 2015 to December 1, 2016, citing the agency’s extensive dialogue with chain restaurants, grocery stores, and other members of the hospitality industry. 

Most credit and debit cards in the U.S., and the point of sale terminals and ATMs that read them, still use “magnetic stripe” technology. Magnetic stripes are obsolete and relatively insecure, allowing fraudulent practices such as “skimming” (acquiring cardholder and account data by “reading” the strip, and then making fraudulent transactions or counterfeit cards). Magnetic stripe-based technology also does not support secure data transmission through contact or near-field contactless interfaces, which is seen as impeding the emergence of fully mobile cardless payment modes in the U.S. 

From franchisers and companies hiring workers through staffing agencies, to participants in the so-called “sharing economy,” companies and individuals today enter into a variety of contractual arrangements to reduce costs and to maximize available capital, flexibility, talent and efficiency in delivering goods and services. The recent decision of the National Labor Relations Board (“NLRB” or “Board”) in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015), may change how many of these relationships function, and even, whether some of them are now too risky for some participants.

Emily Harris Gant is an alcoholic beverage attorney, and an Owner in GSB’s national Hospitality, Travel, and Tourism Group.

A distributor is knocking on your hotel restaurant’s door, offering key chains from a hot new distillery for your customers. A brewery just dropped off coasters for use in the restaurant’s bar. And a winery offered cork screws for your sommeliers.

As a responsible retail licensee, you know that most states tightly govern the relationships among liquor retailers, manufacturers, and distributors.

But where’s the line? What kind of “swag” and other valuable items can your hotel restaurant accept for free without running afoul of the law? To find out, read on.