A federal court recently upheld a National Labor Relations Board (NLRB) ruling that found the Hotel Bel-Air in Los Angeles unlawfully avoided rehiring unionized workers after a temporary closing.
The NLRB required the hotel to reinstate former employees and give them backpay and reimbursement for search-for-work expenses. The amount of backpay could total tens of millions of dollars, according to the workers’ union, Unite Here Local 11.
On Oct. 18, the 9th U.S. Circuit Court of Appeals affirmed the NLRB’s order, which also directed the five-star luxury hotel to compensate the affected workers for the adverse tax consequences of receiving lump sums of backpay.
“We will appeal to the United States Supreme Court and believe we will be vindicated once the entire legal process is over,” said Brittany Williams, a spokesperson for the hotel.
Background
Under the National Labor Relations Act (NLRA), it’s unlawful for employers to fire, suspend, lay off, fail to recall from layoff, demote, discipline or take any other adverse action against employees because of their union activities.
Workers were laid off when the Hotel Bel-Air underwent extensive renovations in September 2009. Before the hotel reopened in 2011, the hotel held a job fair, but it refused to rehire 152 former employees who had reapplied for their former jobs. The hotel argued that it didn’t rehire them because they lacked the skills for the job or they lacked job stability, according to court documents.
In 2019, an NLRB administrative law judge concluded that the Hotel Bel-Air and its owner at the time, Kava Holdings, committed unfair labor practices by refusing to rehire union-affiliated former employees so that it could avoid bargaining with the union.
In January 2021, a full panel of the NLRB agreed with the administrative law judge’s decision. It said the hotel violated the NLRA by refusing to recognize and bargain in good faith with the union and by making unilateral changes to the terms and conditions of employment.
After the hotel reopened, the new wage rates for certain job classifications were determined by the wage rates at other luxury hotels in the Los Angeles area, rather than by the terms of the expired collective bargaining agreement, the NLRB said. The hotel also allegedly changed the terms and conditions of employees’ meals and breaks, paid time off, retirement benefits, health and life insurance, seniority, and how employees are compensated during attendance at mandatory meetings.
During the layoffs in 2009, the hotel offered severance packages to laid-off employees in exchange for relinquishing their reinstatement rights. Approximately 179 employees signed the waiver. The NLRB concluded the hotel illegally dealt directly with employees before reaching a valid impasse in negotiations with the union.
The circuit court’s decision “is an incredible, long-overdue victory for the former workers of the Hotel Bel-Air, who were kicked out of the hotel for no other reason than the hotel’s desire to bust the union. These illegal and immoral practices have no place in our city,” said Kurt Petersen, co-president of Unite Here Local 11 in Los Angeles.