Court upholds city edict on hotel-worker retention

A federal appeals court upheld a Providence city ordinance that requires the new owners of hotels to retain current employees for at least three months, but the attorney for the plaintiffs said his clients are mulling a final appeal to the United States Supreme Court. More

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Court upholds city edict on hotel-worker retention

Posted 12/19/11

A federal appeals court upheld a Providence city ordinance that requires the new owners of hotels to retain current employees for at least three months, but the attorney for the plaintiffs said his clients are mulling a final appeal to the United States Supreme Court.

Providence Attorney Robert P. Brooks, who represents two downtown hotels and the Rhode Island Hospitality Association, said his clients were “disappointed” by the ruling issued Dec. 2 in the U.S. Court of Appeals for the 1st Circuit in Boston. He represents The Westin Providence and Hilton Providence. The appeals-court decision upholds a March 31 ruling in U.S. District Court by Chief Judge Mary M. Lisi, taken in response to an earlier challenge by the same plaintiffs.

In the Dec. 2 ruling, Chief Judge Sandra L. Lynch, Circuit Judge Michael Boudin and Senior Circuit Judge Norman H. Stahl found that the 2009 ordinance does not violate the constitutional rights of hotel owners and current law related to equal protection and contract rights.

“Whether or not this ordinance will in fact protect and enhance tourism in Providence, its stated purpose, is far from clear,” the judges said in the 21-page ruling. “The city has leeway to experiment as long as it does not run afoul of federal labor policy and pre-emption under the United States Constitution. At this stage we cannot say it has.”

Brooks, a shareholder at Adler Pollock & Sheehan, told Providence Business News his clients are “reviewing their options,” including an appeal to the nation’s highest court.

However, he also pointed out that grocery-store operators in Los Angeles, Calif., have filed a U.S. Supreme Court appeal against a similar ordinance in that city. The move appeals a California state Supreme Court decision that ruled in favor of the city.

The local ordinance requires that, when a hotel with 25 or more rooms in Providence changes hands, the new owners must retain for at least three months existing full- and part-time staff members who have been on board two months or more.

Exemptions are built into the measure, allowing a new owner to dismiss workers for good cause or whittle down staff if fewer workers are required under new operations. The new owner retains full right to set conditions and terms of employment for the three months. The measure was enacted Oct. 26, 2009, and substantially amended Nov. 1, 2010.

In addition to affecting hotels, Brooks noted, the ordinance has an impact on in-house businesses that hotels operate such as restaurants or food and beverage services. So for instance, Brooks said, if a new owner wants to replace a hotel’s Italian restaurant with a sushi bar, existing staff may not be trained in sushi techniques, but under the ordinance would have to be kept on for three months.

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