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Posts from March 2012.

Our newest post is provided by Victoria Slade, a member of Garvey Schubert Barer's Labor and Employment Group and a frequent collaborator with our Hospitality, Travel & Tourism Practice Group.  Victoria's post looks at two recent National Labor Relations Board reports and their impact on employers' social media policies.  Several planned upcoming posts will also be looking at social media and its effects on hoteliers's and restaurateurs' operations - stay tuned.

Thank you Victoria for this important update.

Thanks to the internet, a single disgruntled employee can now do dramatic damage to a company’s image through posts on social media sites. (Just ask Domino's Pizza or Hotel Renaissance.)  The social media policies employers have instituted in the last few years may work to inhibit online employer-bashing; however, they can also come perilously close to violating the law.  To assist employers in navigating this rapidly changing area of law, the National Labor Relations Board (“NLRB”) has issued two social media reports in the last seven months, explaining their rulings in several recent social media cases. As this posting demonstrates, even if you think you have a good social media policy, you may want to revisit it, given the latest NLRB guidance.

Employees in both unionized and non-unionized workplaces have protected rights to certain types of speech under the National Labor Relations Act.  These include, briefly, the right to discuss terms and conditions of employment and unfair labor practices with coworkers and the right to engage in concerted activity.  Employers who want to restrict employees from making disparaging comments about the company online must carefully phrase their policies to avoid trampling on these rights.

Garvey Schubert Barer’s Hospitality, Travel & Tourism Practice Group, in conjunction with program sponsors and presenters, recently hosted two morning Hospitality Forums in Seattle, Washington and Portland, Oregon.  The forums were designed for hotel owners, developers, investors and operators as well as hospitality industry service providers, consultants and lenders.  Both events were well attended—a testament to the sponsors and presenters who offered current data, insights and analysis into issues of importance to those in the hospitality industry. 

In particular, Matthew Gardner, of Gardner Economics, provided a macro-level discussion of current economic trends and then narrowed the focus to the Northwest.  Matthew sees Seattle as having strong institutional underpinnings that will contribute to continued economic growth.  Within the Northwest, condominium projects are not being approved by banks.  Apartment construction projects in Seattle are being approved but that segment may soon be over saturated.  Matthew did not express concern with the limited amount of hospitality construction underway.  A similar presentation by Tom Potiowsky, the PSU Chair of Economics and Director of the Northwest Institute for Applied Economic Research, led off things in Portland.  Although not quite as bullish on the local economy as Matthew, Tom was confident that a recovery (although slow) was underway in Oregon, and more particularly, the greater Portland market.  Copies of Matthew’s presentation and Tom’s presentation are attached. 

As a follow up to his excellent presentations at the recent hospitality forums hosted by Garvey Schubert Barer’s Hospitality, Travel & Tourism Practice Group, Gregg Rodgers offered to prepare today’s post on the often discussed, but horribly misunderstood, EB-5 program. Gregg chairs GSB’s Immigration Practice Group and is an important member of, and regular contributor to, our Hospitality, Travel & Tourism Practice Group. Gregg has represented those investing funds into their own projects as individuals and into Regional Centers, and he has worked with many potential EB-5 project sponsors (those using investor's funds to finance projects), including new hotel development projects in the Northwest, as they have evaluated their options.  Today’s post provides a great overview of the EB-5 program and its general requirements. 

Thank you Gregg . . . 

You may have heard about an influx of foreign investors into the “EB-5” program and wondered – what are they talking about and how can I get my project jump-started with it?

EB-5 is a short-hand reference to the “Employment-Based", 5th-listed process for getting status as a lawful permanent resident, also known as a “green card.” It was created in the early 1990’s, but only came into its own beginning in 2008, when the great recession dried up local funding for major projects. It was then that many creative developers and others realized that making changes to their business model could open up an untapped source of investment, resulting in the creation of a longer-term relationship between developers and investors, and a potential return for investors that included not just increased wealth, but a new life in the United States. “Regional Centers” have become the focal point of EB-5 investment over the past few years.

Our newest post comes from my Portland, Oregon colleague and partner, Joy Ellis.  For those of you who have not met Joy, Joy serves as the Portland Chair of our Hospitality, Travel and Tourism Practice Group. She also has over 15 years of legal experience in the areas of commercial litigation, employment litigation and employment-related advice, and brings us important news on the latest chapter of ongoing litigation between online travel companies and the many jurisdictions that have sought to collect allegedly unpaid or underpaid lodging taxes.  This latest installment involves our own City of Portland.  Thank you Joy for this important update.

Across the country, online travel companies (“OTCs”) are involved in litigation with local officials over the tax on hotel rooms. City officials argue that online travel sites shortchange the cities on their local hotel taxes. The OTCs disagree.

Here’s the crux of the issue: let’s say a guest books a hotel room through an OTC’s website. The traveler booking the room pays an amount to the OTC, part of which goes to the hotel and part of which is kept by the OTC as a facilitation and service fee. The fee attributable to the hotel includes the often severely discounted ("net" or "merchant") room rate agreed upon between the OTC and the hotel, plus the hotel tax owed on that discounted rate. City officials want the hotel tax to be based on the entire ("retail") amount paid by the traveler to the OTC. The OTCs argue that local lodging tax on hotel rooms should be remitted based on the actual amount a hotel receives for a room rather than the total amount that a guest pays the OTC for a room. 

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Greg Duff, Editor
Greg Duff founded and chairs GSB’s national Hospitality, Travel & Tourism group. His practice largely focuses on operations-oriented matters faced by hospitality industry members, including sales and marketing, distribution and e-commerce, procurement and technology. Greg also serves as counsel and legal advisor to many of the hospitality industry’s associations and trade groups, including AH&LA, HFTP and HSMAI.

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