Hyatt, UNITE HERE end stalemate
Hyatt, UNITE HERE end stalemate
02 JULY 2013 9:02 AM

Employees at unionized Hyatt Hotels properties in four major U.S. cities will vote to ratify a new contract that could be in place as soon as this fall if approved, sources said.

REPORT FROM THE U.S.—Employees at unionized Hyatt Hotels Corporation properties in four major U.S. cities will vote to ratify a new contract that could end a years-long stalemate and lead to wage increases, ending a national boycott.

Hyatt and UNITE HERE, a union of hospitality workers in the U.S. and Canada, announced a national agreement Monday that, if ratified, will put in place a long-term contract in Hyatt-managed hotels in San Francisco, Honolulu, Los Angeles and Chicago. UNITE HERE represents more than 100,000 hotel workers in more than 900 hotels in the United States and Canada.

“The national agreement between Hyatt and UNITE HERE is great news for our associates in markets where they haven’t seen wage increases in four years,” Doug Patrick, senior VP of human resources for Hyatt, told Hotel News Now. “The associates will see the increases in wage and benefit enhancements they deserve.”

The agreement also ends a national boycott of Hyatt properties that UNITE HERE was calling for, which Patrick said was music to Hyatt owners’ ears.

“We have received positive reaction (from hotel owners),” he said. “We notified them (Monday) morning and they’re pleased with the fact that the national boycott has ended.”

Several Hyatt owners and operators either did not return messages or declined to comment on the agreement.

Patrick said he doesn’t see major changes in hotel owner profitability should the contract be ratified and wages increased.

“We don’t see any differences moving forward than how we have managed assets and operated in previous contract negotiations,” he said. “We feel very confident we’ve negotiated contracts that are competitive.”

In a news release, UNITE HERE lauded a key provision of the agreement that “establishes a fair process,” which includes a mechanism for employees at a number of Hyatt hotels to vote on whether they wish to be represented by UNITE HERE.

“We look forward to a new collaborative relationship with Hyatt. This agreement shows that when workers across the hotel industry stand together, they can move forward, even in a tough economy,” D. Taylor, president of UNITE HERE, said in the news release.

Contract details vary from market to market, said Stephanie Sheppard, spokeswoman for Hyatt, adding that, on average, the combined wage and benefit increases are approximately 4% per year.

"We expect contracts to be ratified at nine hotels across the four major markets, which affects approximately 5,000 associates," she said. "Beyond that, we continue to determine locations with UNITE HERE where we both agree to hold a voting process."

Next steps
Peter Fischer*, attorney with Baker & Hostetler, said he expects members to ratify the contract by the fall. He said Hyatt has been under a lot of pressure to get a deal done.

“It gives Hyatt the chance to come out from all the bad press they’ve been receiving,” he said.

Fischer said UNITE HERE’s strategy with Hyatt represented the latest trend in union organizing—bypassing a National Labor Relations Board secret ballot and instead using a petition drive. It’s a much quicker, less “cumbersome” process, he said, adding: “It’s a big misnomer that hotels are organized by the old NLRB election system.”

David Sherwyn, associate professor of law and academic director for The Center for Hospitality Research at Cornell University’s School of Hotel Administration, agreed, saying the agreement is a good deal for both sides.

“What it also shows is the belief of the inadequacy of the NLRB election,” he said. “UNITE HERE was adamant that they didn’t want to go to an NLRB election where you can do all kinds of mean and nasty stuff.”

Sherwyn said Hyatt didn’t want to authorize card-check voting. They wanted employees to go into booths to vote ‘yes’ or ‘no’ for elections. Card check involves a lot of peer pressure because voting is done in public, which Hyatt was against, he said.

“(UNITE HERE is) giving them an election, and I’m sure that they set some sort of ground rules about what they can and cannot be said and how the election is going to be done and so on,” he said. “What I’m inferring is that Hyatt feels good because at the end of the day their employees are getting a vote.”

Patrick said both parties were able to come to the table and compromise, which was essential in the two sides reaching an agreement.

“There was willingness to reach an agreement and compromise on both sides of the table,” he said. “That pushed us over the top and got the deal done.”

Sherwyn said UNITE HERE has deals in place with several other hotel brands that address chard-check issues. Many municipalities, such as New York, already have card-check provisions in place, he said.

“Ultimately both parties realize that this type of long-term dispute is bad for the industry,” he said.

Sources said details of the contract, specifically wage increases and what the “fair process” is exactly—will most likely become public once the contract is ratified.

“We certainly know that they’re not doing a traditional NLRB election,” Sherwyn said.

Hotel News Now Editors Patrick Mayock and Shawn A. Turner contributed to this report.

*Correction, 3 July 2013: The original version of this article incorrectly spelled Fischer’s last name.

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