Why Do These Hotel Union Workers Oppose Industry Efforts to Get $20 Billion in Federal Relief?

The U.S. hotel industry’s largest lobbying group, the American Hotel & Lodging Association, combined forces with Unite Here, one of the largest hospitality labor unions, earlier this year in support of a roughly $20 billion plan for targeted aid to the industry in light of the pandemic.

But one of the largest chapters of the labor group isn’t on board with that bill — the Save Hotel Jobs Act — and calls it an unnecessary handout to major hotel corporations.

“What’s happening right now is pandemic profiteering,” said Ada Briceño, co-president of Unite Here Local 11, the Southern California and Arizona chapter of the labor group. “I’m disgusted. This is a time when American workers and corporations have to stand together to get through and go back to normality for the guests, for the workers, and for the profits of the corporations. Instead, the hotel industry is conditioning the return of these hardworking Americans on $20 billion.”

Briceño claimed previous instances of federal aid in the name of job creation failed workers. Seventy-five percent of Unite Here’s roughly 300,000 members nationally remain unemployed after hotels were able to tap into nearly $13.8 billion in Paycheck Protection Program funding across multiple pandemic relief measures. PPP loans were supposed to go to workers, but there have been instances of misused funds.

Eagle Hospitality Real Estate Investment Trust, a U.S. lodging trust currently going through bankruptcy, alleged in a court filing earlier this month two investors involved in its Queen Mary hotel in Southern California received $2.4 million in PPP loans and used it for personal matters instead of workers and operations at the cruise ship-turned-hotel.

Unite Here 11 wants greater transparency and accountability around the PPP program as well as any additional targeted aid the hotel industry receives from Congress.

But a significant part of Unite Here 11’s issues with the Save Hotel Jobs Act stems from distrust with the California Hotel & Lodging Association, an AHLA partner. The California lobbyist group opposed “right to return to work” legislation Unite Here 11 proposed for the state and argued it would slow down the rehiring process during the recovery, according to a letter obtained by Skift.

Despite the opposition and a veto from California Gov. Gavin Newsom last year, a slimmed-down version of the measure was signed into law in April. The new law requires California hospitality and business services companies to first offer jobs to workers furloughed during the pandemic within five days of an available opening.

“They could have stood side by side with us to bring our workers back. But instead, they fought us all the way on our legislation, so there’s no trust,” Briceño said. “You think we can trust the industry to do the correct thing with the $20 billion? I don’t think so.”

The AHLA declined to comment for this story. Unite Here’s national organization did not respond to multiple requests for comment.

But the Save Hotel Jobs Act does call for hotel grant recipients to use funds for payroll and benefits. It also would require recipients to give recall rights to laid-off workers.

An AHLA grant proposal announced earlier this year also targeted workers as the largest beneficiary. As part of its pitch for targeted relief, the AHLA grant proposal would provide hotel owners with funding where 60 percent would go to keeping employees on the payroll and 40 percent would go to servicing debt like mortgage payments.

Unlike PPP, the targeted relief both the AHLA and the national Unite Here organizations want would be eligible for hotels of all sizes instead of just small businesses.

“You have whole segments of our industry that did not receive any financial assistance whatsoever,” Brian Crawford, executive vice president of government affairs at the AHLA, told Skift in March. “We see there’s an opportunity to create a grant program to jumpstart the hotel industry job recovery to bring back people a little bit earlier than they would otherwise.”

A Lobbyist House of Cards

Both the AHLA and Unite Here’s national group are still working together in support of targeted relief for the hotel industry despite Unite Here 11’s opposition. There has been no contact between national Unite Here leaders and Unite Here 11 on its stance against the Save Hotel Jobs Act, Briceño said.

But the Sun Belt chapter’s opposition could swell into a difficult headwind for an already fragile working relationship between two unlikely allies.

Unite Here 11 is one of the labor group’s largest chapters, with more than 32,000 members representing about 10 percent of the national organization’s overall headcount. Whatever stance it has holds weight in the greater organization.

The AHLA and Unite Here joined forces this spring in calling for targeted relief, but the timing of the lobbyist push may be a hard sell for members of Congress fearful of bad optics and concerns of more spending overheating the economy.

Hotels and restaurants have been a bright spot for adding jobs in recent months, even for April’s disappointing jobs report. Many hotel owners and executives say it’s hard to call back workers and expect widespread staffing shortages heading into the summer.

While the timing of the hotel industry’s call for targeted aid may have seemed poor, that is largely due to months of disagreements between the AHLA and Unite Here before they could reach a deal, sources close to those talks tell Skift.

Even with a busy summer travel season ahead, the AHLA estimates the U.S. hotel industry will end the year with about 500,000 fewer jobs than before the pandemic.

But Briceño and other members of Unite Here 11 aren’t buying the idea a $20 billion rescue plan is what’s needed to get workers back.

“It’s a slap in the face for the hotel workers who have struggled so much in this pandemic,” she said. “They lost their family, they lost their loved ones, and they lost their jobs. Now, the industry is saying they can come back — only if they get $20 billion.”