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Workforce Relations

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Extreme Wages

In the hotel industry, our employees are the most important asset we have. Our employees are the face of our business to our customers.

We take care of our employees in the hotel industry, and there’s tremendous opportunities for upward career growth for everyone. Take these two statistics about the hotel industry, for example:

  • More than 50% of hotel managers and general managers started at entry-level positions
  • More than 80% of employees who start at minimum wage receive their first raise and promotion within one year on the job, and 100% within two years

When it comes to the minimum wage in our industry, we truly view it as the floor of an employee’s career and one which they will quickly move above and beyond. That’s why it’s so frustrating to see some groups pushing extreme minimum wages of up to $15 per hour.

THE FACTS

Extreme wage proposals, like those in Los Angeles, Seattle, and many other states and cities throughout the country, are having real, negative effects on our businesses, customers, and especially our employees.

  • In Seattle, 900 workers in the hospitality industry lost their jobs due to the extreme wage law
  • In Los Angeles, 1,300 hotel workers lost their jobs due to the extreme wage law that just targeted hotels

The effects of the law aren’t hard to follow. As businesses respond to the extreme wage law with increased prices, customers respond by either cutting back their purchases are going somewhere else altogether. When customers leave, the employees run out of work to do and the business has no choice but to cut down the workforce.

Extreme wage laws also cause more than just job losses.

  • Extreme Wages prices low-skill workers out of jobs. Jobs enable low-skill workers to learn new skills but instead they face even higher obstacles to employment.
  • Extreme Wages results in fewer jobs for young people, especially in minority communities.
  • Extreme Wages disproportionately hurt those who currently lack a job in favor of those who are already holding a job – further driving out of the workforce those who might be temporarily without a job.

CONCLUSION

We in the hotel industry already pay wages above and beyond the minimum wage. We need to do so in order to hire and keep our valuable employees, who are the face of our business.

Extreme minimum wage laws only hurt employees by causing job losses, increased prices, and fewer benefits and perks.

AAHOA supports:

  • Keeping the minimum wage at a reasonable level that encourages businesses to hire high-risk employees and provide them with a career opportunity
  • Keeping the minimum wage at a statewide, universal standard that makes it easier for businesses to understand the law and keep or expand their businesses wherever they’re located

AAHOA opposes:

  • Extreme wages that cause increased prices and job losses
  • Extreme wage laws that treat hotels differently than other business—like Los Angeles’ extreme wage for hotel workers only
  • Extreme wage laws that treat franchised businesses differently from independent, non-franchised small businesses

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Joint Employer

THE ISSUE

In July of 2014, the National Labor Relations Board (NLRB) deemed McDonald’s USA LLC to be a “joint employer” in complaints by employees against franchisees. This ruling, known as Browning-Ferris Industries Inc., reverses a 30 year-old legal standard and threatens the viability of the entire franchisor-franchisee business model that breeds job growth and business expansion.

For decades, small businesses had to exercise direct and supervisory control over employees to deemed joint employers. This allowed for a prosperous relationship between franchisees and franchisors, one in which franchisees had the autonomy to make the day-to-day business decisions, including: hiring, firing, compensation, benefits, hours, disciplinary procedures and supervision. Now, due to increased liability under the new “joint employer” relationship, small business owners risk losing these responsibilities, making them de facto employees of franchisors.

AAHOA strongly opposes the expanded definition of joint employer, and has advocated for legislation at the state and federal level that gives small business owners necessary flexibility and independence.

LEGISLATION

Federal:
AAHOA supports the Protecting Local Business Opportunity Act (HR 3459/ S 2015). This bill is sponsored by Congressman John Kline (R-MN-2) in the House of Representatives, and Senator Lamar Alexander (R-TN) in Tennessee.

If enacted, this legislation will reverse the NLRB’s ruling and restore independence for franchisees and small business owners. Take action today!

More Resources:

State:
AAHOA has worked directly with Georgia State Senator John Albers (R-GA) in an attempt to pass the Protecting Georgia Small Businesses Act (SB 277). This legislation is strongly supported by businesses of all types and sizes, and protects the independence of franchisee small businesses by writing the old joint-employer standard into Georgia law.

The AAHOA Government Affairs team will continue to advocate for the replication of this bill in other states across the country.


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Overtime Regulations

THE ISSUE

On May 18, 2016, President Barack Obama and Labor Department Secretary Tom Perez issued a new, updated overtime rule.

The new rule more than doubles the salary threshold for workers exempt from overtime from $23,660 to $47,476 a year, or $455 to $913 per week. These new salary thresholds take effect on December 1, 2016.

AAHOA is opposed to severe overtime expansion because it will cut the hours of full-time workers, increase the use of part-time workers, and reduce job advancement opportunities for employees. These new regulations will hinder productivity for small business owners, and will ultimately will harm job creation and business growth for hoteliers across the country.

LEGISLATION

AAHOA supports the Protecting Workplace Advancement and Opportunity Act (H.R. 4773, S. 2707) in both the U.S. House and Senate. This federal legislation, introduced by Senator Tim Scott (R-SC) and Congressman Tim Walberg (R-MI) requires the U.S. Department of Labor to complete extensive economic analysis before making any changes to federal overtime rules. 

As part of AAHOA’s efforts on this issue, we’ve joined a grassroots coalition of business owners, non-profits, educational institutions, and public sector organizations to raise awareness of the negative consequences of the overtime regulations. The coalition is called Partnership to Protect Workplace Opportunity.

More Resources: 

 


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