3 government issues hoteliers might have forgotten
3 government issues hoteliers might have forgotten
17 MAY 2016 7:16 AM

Here’s an update on three issues of importance to hotel owners and operators: the National Labor Relations Board; online booking scams; and emergency uses for guestroom phones.

It’s a presidential election year in the United States, so there’s a lot of talk in the media and around office water coolers about what’s happening in Washington, D.C., now and what might happen after inauguration day next January. Of course, the hotel industry has a dog in this fight, with a variety of pending and potential issues that could affect owners and operators.

There is often a splash of publicity as political issues relevant to the hotel industry bubble to the surface. Minimum wage is a perennial headline-maker, as are any topics related to labor. However, a proposed bill in Congress or regulation from the bureaucracy often grabs the attention of the hotel media and hoteliers only to be mostly forgotten until concrete action happens—if it ever does.

With that in mind, here’s a look at what’s happening with three governmental issues of concern to hotel owners and operators.

Are franchisors joint employers with franchisees?
Last year, the National Labor Relations Board issued a blockbuster ruling that has the potential to irrevocably change the relationship dynamic between hotel franchising companies and their licensees. Obviously in a franchise-dominated industry like hotels, any change in that relationship could have far-reaching effects for both parties.

In a case that did not directly involve hotel companies, the NLRB ruled franchising companies that exert significant influence over labor decisions of their franchisees could be considered a “joint employer” and thus be legally responsible for any labor law violations committed by franchisees.

And while it’s not true that hotel franchisors typically exert unduly influence and even coerce franchisees in labor-related issues, if the ruling holds—and it’s currently under appeal—franchising companies could be forced to answer for the actions of their franchisees, which is a potential legal and financial nightmare.

At the behest of the franchising industry, legislation was introduced in the U.S. Senate and House of Representatives to designate franchisors as joint employers “only if each shares and exercises control over essential terms and conditions of employment and such control over these matters is actual, direct and immediate.”

Want more on labor issues in the hotel industry? Read HNN’s “Labor Pains” Special Report from March. 

The House bill was sent to committee in October, while the Senate version went to committee in March.

But given Congress’ inaction over many issues, the franchising community is attempting to spur the federal government. It formed a coalition of franchised businesses to serve as a conduit for information on the topic and to lobby Congress and state legislatures to enact protective legislation. To date, seven states have passed or are close to passing legislation that would retain the traditional relationship between franchisors and franchisees.

Stopping online scams
Unfortunately, wherever there is commerce, there can be fraud or deception.

The hotel industry and its customers have been victimized by some scammers who trick consumers into thinking they’re booking directly on a hotel’s website when they’ve actually landed on a bogus site. These consumers think they’re making a reservation but might end up with no room when they arrive at the hotel, might not receive their loyalty program credit or, in some cases, find they’re victims of identity theft or other fraud.

How helping guests victimized by booking scams helps hoteliers in the long run. 

Through the American Hotel & Lodging Association, the industry has been urging the federal government to take steps to stop this practice. The Federal Trade Commission has issued consumer warnings about these potential scams, and several bills are pending in Congress that would crack down on third-party sellers that misappropriate brand identities and trademarks in order to prey on consumers. 

A bill in the House was sent to committee in February, while similar legislation in the Senate has been stalled in committee since last July.

Direct 911 calling from guestrooms
Legislation is slowly snaking its way through Congress that would require multiline telephone systems, such as those in hotels, be configured to allow users to directly dial 911 for emergency service without having to dial an initial digit.

The proposed law is the result of several unfortunate cases in which hotel guests tried to call for emergency service without realizing they needed to dial 9 or some other digit to reach an outside line. The legislation under consideration is called Kari’s Law in honor of a child who tried but failed to call for help from a hotel room to stop the murder of her mother.

The Senate bill was referred to a committee in February, while similar legislation in the House was reported out of committee in late April for consideration by the entire body.

Email Ed Watkins or find him on Twitter.

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