Hotels Don't Waste a Crisis

Javier Gonzalez used to send money every two weeks to his 85- and 90-year-old parents in his home country. He had to stop because his employer, Boston Marriott Copley Place, terminated Gonzalez and 230 of his co-workers last September, after temporarily laying them off at the start of the pandemic. They made up more than half the hotel’s workforce.

Gonzalez is one of 500,000 hotel workers in the U.S. and tens of thousands in Canada who have lost their jobs since Covid hit. Pre-pandemic, there were roughly 1.7 million hotel and motel workers in the United States and 156,000 in Canada.

Gonzalez worked as a lead supervisor in the utility department. Despite the title, he wasn’t management; he helped clean the kitchen and organize banquets at Boston’s second-biggest hotel. Now he is part of a group of 112 nonunion workers at the hotel who signed a petition and are fighting for severance pay and recall rights, with the support of UNITE HERE Local 26.

The Marriott Copley Place changed its rules just days before terminating them, limiting workers to a maximum of 10 weeks of severance pay rather than 26. (Workers received one week per year of service.)

“They say ‘we are a family,’ [but] in the moment that we most need, they throw us away,” Gonzalez said.

Workers are picketing the 1,144-room hotel and have called a boycott. Recently they convinced the LGBTQ+ non-profit legal organization GLAD to move its upcoming October gala to a union hotel.

70 PERCENT STILL OUT

UNITE HERE says that 98 percent of its members—who are overwhelmingly women and people of color—were out of work at the height of the pandemic. Seventy percent remain unemployed today.

The New York Times reported in April 2020 that Marriott, the world’s largest hotel chain, paid out $160 million in quarterly dividends and sought a raise for its CEO while it was laying off workers across the U.S. The company earned $1.2 billion in 2019.

Now Marriott’s stock is near an all-time high, having rebounded from an enormous dip early in the pandemic. The company reported $422 million in profits in the second quarter of this year. The stock price of Hilton has hit a peak as well.

And in 2020, according to the union, Marriott and Hilton alone added 661 new properties that they now operate and almost 90,000 rooms to their global portfolios. Most additions in the United States have been conversions of existing hotels to the Marriott or Hilton brands, rather than newly built properties.

Hilton and Marriott use an “asset-light” business model in which they avoid owning hotels in favor of managing or franchising them for a fee. The properties they used to own have largely been spun off to real estate investment trusts—Park Hotels for Hilton, Host Hotels for Marriott.

When a new Marriott is built or a hotel is converted to a Marriott brand, it will most likely be owned by Host or an external company. The 130-year-old Marriott Copley Place, for example, is owned by Host Hotels.

This business model allows the hotel giants to avoid responsibility for fixed costs like loan payments and property taxes that do not go up or down with sales. It also allows them to gain special tax benefits, says UNITE HERE.

The union bargains with Marriott or Hilton at some hotels. At others, it negotiates with the hotel owner. At still others, it deals with both the owner and the operator.

COST-CUTTING BONANZA

Counter to what you might expect, for the hotel business, Covid has turned out to be a profit-making opportunity.

“The hotel industry is literally seeing the pandemic as the moment that it can drive down labor costs,” said Carlos Aramayo, president of Local 26, who took office the week that Boston’s pandemic shutdown began.

Aramayo said services to guests—like daily room cleaning and room service—are threatened. Technology could be used to replace front desk workers and phone operators. And wholesale contracting of portions of hotels, like restaurants, could be undertaken where it hasn’t been already.

These concerns echo across the U.S. and Canada, though the business conditions vary widely from market to market. UNITE HERE estimates that the end of daily room cleaning in U.S. hotels would permanently cut the housekeeping workforce by up to 39 percent—eliminating 180,917 jobs and costing housekeepers $4.8 billion in annual wages, as well as making the work harder and more dangerous.

Housekeepers on the job are being asked to do more work, while their laid-off or terminated co-workers are left jobless.

In Burnaby, British Columbia, housekeeper Valerie Bisio has worked at the Hilton Vancouver Metrotown since it opened 22 years ago. In February of this year, the hotel began terminating workers with up to 20 years on the job, though Bisio kept hers.

TROUBLE IN METROTOWN

By April, management had fired 97. Bisio and the others who remained held a one-day strike April 15. The hotel’s response was to lock out the remaining workers, and they are now on their 17th week on the picket line.

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“When we were working through the pandemic, we would be doing 10 jobs,” Bisio said. “Instead of just doing the public areas, I would be in charge of the whole hotel, trying to sanitize everything.”

Local 40 communications staffer Stephanie Fung said the cleaning is now probably being done by a dozen managers. “All the well-trained cleaning staff are locked out,” she said. “We are concerned that this poses a serious health and safety threat to the traveling public and that travelers to the Hilton should know about this.”

The hotel did not provide hazard pay or bonuses during the pandemic.

The Vancouver Metrotown is owned by Korean real-estate firm DSDL, chaired by Cho Wook-rae. Cho’s father founded the $2.2 billion industrial conglomerate Hyosung Group, which is run by a Cho family member.

In May, British Columbia’s labor federation called a boycott, which Local 40 estimates will cost the hotel up to $3 million Canadian. The boycott was extended on August 8 by the Alberta Federation of Labour to three Edmonton hotels owned by the same firm.

The union has also sought to involve the South Korean ambassador to Canada on behalf of the workers and has gone after a Canadian bank for lending to DSDL, raising attention to past financial crimes by its chairman.

Metrotown’s tactics during the pandemic are familiar to Local 40. Members at the Pan Pacific Vancouver and the Pacific Gateway Hotel are fighting similar tactics, said a spokesperson. Local 40 represents 6,000 workers in hotels, food service, and remote camps in British Columbia.

RECALL RIGHTS

With the economic impact of Covid ebbing—at least for now—the hotel industry is picking back up again in leisure spots like Hawaii and Florida. Paola Rodelas, a communications staffer for Local 5 in Hawaii, said the union hotels there are now at 100 percent occupancy.

On the other hand, a city like San Francisco, which is more dependent on international and business tourism, is averaging 35 percent occupancy rates during the week at Local 2 hotels, and spiking to 50 percent on the weekends.

But across the board, the union says, employment is lagging occupancy. In Hawaii, only 64 percent of members have been recalled. In San Francisco only 20 percent have been.

According to UNITE HERE, workers who are terminated earn 11.8 percent less at their next job.

FIGHTING BACK IN HAWAII

Bisio bemoaned the fact that British Columbia had not mandated recall rights for hotel workers as California, Nevada, Chicago, and Baltimore have, following campaigns by the union.

In Hawaii, 12,000-member Local 5 is fighting for one-year extensions to the two-year recall rights built into its contracts. Otherwise, the workers still laid off are concerned that next March they will lose their rights ever to return to their jobs.

To air this concern, groups of workers have been filing grievances and organizing shop floor actions. At the Moana Surfrider, a delegation of bussers got the human resources director to add a minimum of two steward and cook shifts and commit to hiring more bussers.

When Kyo-ya Hotels and Resorts, the owner of several Marriott-brand hotels, held a job fair in June despite still having 910 furloughed union workers, some union members alerted the local media. Kyo-ya workers also grieved to reopen the employee cafeteria for two of the hotels, and they met with Marriott executive Kevin Gleason to raise concerns over combining jobs, short staffing, and management doing their work.

Hotel workers in Hawaii have also been leafletting guests about the lack of daily room cleaning and the hotel restaurants that are still closed.

“A lot of the tourists are upset—they didn’t expect they would be Grubhubbing after flying thousands of miles and paying a hundred dollars a night,” said Rodelas.

A hotel with no daily room cleaning, and with only grab-and-go food options, is “almost like a college dorm experience,” UNITE HERE President D. Taylor said in a press release. “And taking these jobs away means that many working families and especially communities of color might never recover.”