Pittsburgh Hotels: Why So Many New Ones and Who Employs All These People? Presented by: Tim Hudak, Clare Gallagher, Elizabeth Colombo & Jay Blount

Transcription

1 Pittsburgh Hotels: Why So Many New Ones and Who Employs All These People? Presented by: Tim Hudak, Clare Gallagher, Elizabeth Colombo & Jay Blount LEGAL PRIMER: 2016 UPDATE AUGUST 5, 2016

2 Hotel Background and Lingo

3 Hotel Background and Lingo ADR (Average Daily Rate) The average rate paid for rooms sold, calculated by dividing room revenue by rooms sold. Occupancy % The percentage of available rooms that were sold during a specified period of time. Occupancy % = number of rooms sold number of rooms available. RevPAR (Revenue Per Available Room) The total guest room revenue the total number of available rooms. RevPAR differs from ADR because RevPAR is affected by the amount of unoccupied available rooms, while ADR shows only the average rate of rooms actually sold.

4 Hotel Background and Lingo 100 Rooms Scenario A Scenario B Scenario C ADR $500 $125 $250 Rooms Occupied Rooms Available Occupancy % 25% 100% 68% RevPAR $125 $125 $170

5 Pittsburgh Market Rooms Growth Hotels opening in 2015 (and early 2016): 248-room Hotel Monaco 135-room Holiday Inn Express North Shore 150-room Homewood Suites by Hilton in the Strip District 225-room Embassy Suites in the Henry W. Oliver Building 197-room Hilton Garden Inn in the Tower Two-Sixty project Total of 955 additional rooms, expanding the Greater Downtown hotel market by 21%. Hotel pipeline: 180-room Drury Inn and Suites on Grant Street 186-room Distrikt Hotel on Boulevard of the Allies 75-room Holiday Inn First Avenue 155-room Even Hotel taking two floors in the Macy s/kaufmann s redevelopment 131-room AC Hotel at 11th and Smallman 161-room luxury hotel as a part of the second phase of the 350 Oliver project Total pipeline of 1,535 rooms in the next two years. * From the 2016 Pittsburgh Downtown Partnership s State of Downtown Pittsburgh Report

6 Pittsburgh Market Potential Effect Historic ADR and RevPAR * From the 2016 Pittsburgh Downtown Partnership s State of Downtown Pittsburgh Report Will this trend continue?

7 Pittsburgh RevPAR Projections

8 Pittsburgh RevPAR Projections

9 Pittsburgh RevPAR Projections

10 Pittsburgh RevPAR Projections

11 Who Employs All These People Staffing Agency

12 Joint Employer Developments McDonald s In July 2014, the NLRB s General Counsel authorized complaints against McDonald s for the employment decisions of individually owned and operated franchise restaurants. Litigation continues on these cases. Browning-Ferris Industries In 2015, the NLRB issued a decision replacing the direct and immediate control standard with an indirect and potential control standard. Miller & Anderson In July 2016, the NLRB issued a decision that employer consent is not necessary for proposed bargaining units that include both solelyand jointly-employed employees if the employees share a community of interest. Potential effect on hotel franchisors and hotel managers

13 Joint Employer Developments Marriott Form Franchise Agreement in 2012 Marriott Form Franchise Agreement in 2015

14 Joint Employer Developments Recommendations for staffing agreements: No authority over the wages, hours, benefits and working conditions of contractor s employees (including any reservations of that authority). No requirements to follow your employment practices/policies for your employees; contractors to have their own written policies (with employee handbooks). Require contractor to provide an on-site supervisor to supervise contractor s employees. Require indemnification from contractor re: finding of joint employment. Require your contractor s workers compensation coverage to include an Alternate Employer Endorsement (WC ), naming you as the alternate employer. Consider using only contractors with national operations (to minimize risk of fly by night operators who don t take the risks seriously).

15 Questions? Tim Hudak (412) Clare Gallagher (412) Elizabeth Colombo (412) Jay Blount (412) LEGAL PRIMER: 2016 UPDATE AUGUST 5, 2016