Cambridge City Council threatens to shut Hyatt hotel over labor relations
By adamg - 4/6/10 - 8:03 am
Marc Levy reports the council yesterday unanimously passed a measure - which still needs approval from city lawyers - that would prevent the Hyatt Regency and other hotels from renewing their innkeepers' licenses if they attempt to outsource their housekeeping services. At issue: The way the chain fired (then offered jobs back to) housekeepers in the Boston area.
Comments
Only in Cambridge
So when will they pass resolutions banning every other industry from outsourcing? There are just way too many things wrong with this kind of business interference.
Would this work better?
A city tax on every employee who performed work in the city and did not get minimumm benefits like sick time and health care.
It is in the best interest of the city to not have people commuting to work sick, untreated for TB, etc.
Not legally possible
MA municipalities do not have any inherent power to tax. They can only levy such taxes in such amounts as state law allows. So unless there's a state law allowing municipalities in general or Cambridge in particular to do as you propose it's a dead letter.
The Cambridge City Council
The Cambridge City Council knows more about how to run a hotel than the management?
um... where did they say they
um... where did they say they did?
The Council's telling
The Council's telling Cambridge hotels how to run their business - that they can't outsource housekeeping duties.
What if the only way for a property to keep running is to outsource housekeeping? The Council seems to be saying it's better to have a hotel close and everyone lose their jobs, than lose one department (whom would just get re-hired, albeit at a lower wage).
Rehired?
The only reason the employees at the heart of this first action were offered to be "rehired" (the Hyatt wasn't rehiring them, they were just working with the outsource company to get them jobs there instead) was because they made a stink. I'm sure the outsource company had enough workers to do the job when they took over for the Hyatt ex-employees. In fact, it was the *training* of the outsource company employees by the Hyatt ex-employees, who were lied to as to the reason for the training, that started the stink. So, don't think that this outsourcing measure is meant to keep the housekeepers in their jobs. They're essentially gone...unless the outsource company brought in needs more employees (often with little to no benefits and substantially reduced wages (50%)).
If outsourcing is the ONLY answer, then maybe management should be outsourced. The benefit and wage savings for dumping a high paid executive in lieu of someone who can phone in the decision making from Tulsa is probably greater than any wage dumping a housekeeper would be able to provide. Also, if outsourcing is the only way to keep the hotel solvent, then I doubt that hotel is going to survive in the few months after the outsourcing begins anyways. A death spiral is a death spiral for a reason. Of course, most of these decisions aren't for saving the hotel from a death spiral...they're made to boost the profit margin higher.
I'm not certain about this
I'm not certain about this hotel, but many hotels do "outsource" their management - one entity owns the property, who contracts with a separate management company to run the hotel. The ownership will require a certain stream of revenue from the property - they're not running a charity, they want a return on their investment. If costs exceed income, you either need to cut one or increase the other. Since the recent recession so pummelled the hospitality industry, it's very hard to increase income; so you need to cut costs, or close.
Maybe the management of the hotel here screwed up, I don't know. If so, they should be taken to task by their bosses, board of directors, shareholders, or the ownership group. But an entity that hasn't seen the hotel's books (City Council), and is really privy to just one side of the story, shouldn't be making decrees about the propriety of the hotel's business decisions.