Category Archives: Insurance

by | September 18, 2012 · 6:12 am

Hospitality Industry Legal Risks: Pennsylvania Restaurant Franchise Settles "Class-Action Discrimination Lawsuit"; Employees Denied Promotion Can Get Compensation For "Lost Opportunities"

The lawsuit said that the company relegated black employees to  back-of-the-kitchen work and denied them promotional opportunities…Under the settlement, anyone who worked for Covelli’s Panera franchises from  Jan. 11, 2008, through Jan. 11, 2012, for more than one year, and applied for or  wanted a promotion, can get compensation for alleged lost opportunities…for  each hour worked after their first year, they can get 70 cents — roughly what  they would have gotten through a one-level promotion.

Around 200 to 300 current or former employees of Panera Bread franchisee  Covelli Enterprises stand to get payments under a class action lawsuit  settlement that won preliminary approval from a federal judge at a hearing  today.

Attorney Sam Cordes, who represents Mr. Vines and the class of employees,  told U.S. District Chief Judge Gary Lancaster that the settlement terms will  soon be published in newspapers in areas in which Covelli franchises  operate.

Judge Lancaster gave the settlement his initial nod, though he is expected to  hold a hearing to hear any objections from class members. Neither Mr. Cordes nor the attorney for Covelli would comment after the  hearing. Neither had an estimate of the costs to the firm.

In addition to the payments to black employees, Mr. Vines would get $10,000  and Mr. Cordes $66,000 under the settlement agreement.

Read more: http://www.post-gazette.com/stories/local/region/panera-class-action-settlement-gets-preliminary-approval-653740/#ixzz26pWk7kLY

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by | September 17, 2012 · 6:31 am

Hospitality Industry Property Risks: Oregon Hotel Fire Caused By Cigarette Thrown In Bark Dust; $75,000 In Damage To Structure

“…the building’s fire sprinkler system activated in the attic and stopped that fire from spreading to the rest of the hotel…Fire investigators said the fire started in bark dust and they believe the fire had been burning for some time…The fire caused at least $75,000 in damages to the building and its contents…”

A cigarette is to blame for a fire that damaged the side of the Best Western Hotel in Forest Grove on Sunday afternoon. Firefighters were called to the hotel at 3933 Pacific Ave. at about 2:45 p.m. to reports of a fire burning up the side of the building.

When fire crews arrived, they were able to put the fire out, but not before it had spread up the two-story hotel.

Hotel guests had reported smelling smoke earlier in the day, but nothing was ever found.

A hotel housekeeper first spotted the fire and quickly started to evacuate about a dozen guests at the hotel.

Officials said another housekeeper grabbed a fire extinguisher but the fire was already burning inside the wall space. Staff at the hotel are working to find another hotel in the area for displaced guests.

Fire officials said this is one of several fires in bark dust that has occurred over the last week in Washington County.

For more:  http://www.kptv.com/story/19558127/fire-damages-forest-grove-hotel

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by | September 16, 2012 · 7:31 am

Hospitality Industry Legal Risks: Restaurants Forced To Settle "Class-Action Lawsuits" For "Wage And Hour" Claims; Potential Damages Are Double Wages Owed Dating Back 2-6 Years

“… a restaurant  is permitted to require front-of-the house employees to “pool” their tips, the  pool may be illegal if it is shared with employees who interact with customers  only indirectly. And if the pool is illegal, regardless of the reason, the  restaurant can incur enormous liabilities to employees, even if those employees  each collect hundreds of dollars per week in tips, which is often the case…”

The hospitality industry is under siege by attorneys who stand to gain big  fees from huge class-action settlements. The same gains do not apply, however,  to the waitstaff and other restaurant employees on whose behalf these lawsuits  are filed.

On a federal level, wage and hour claims are brought under the Fair Labor  Standards Act, passed in the 1930s to address intolerable conditions, such as  child labor and six-day workweeks of 10- to 12-hour days without overtime pay.  Such conditions were long ago eradicated from most restaurants and other  establishments, but the FLSA, as well as state wage and hour laws, have  continued to expand by prohibiting common practices that many eateries have  followed for years.

When faced with class actions, most restaurants have few options. Potential  damages often amount to double the wages or tips owed, dating back from two to  six years. Prejudgment interest rates can be as high as 9%, depending on the  state, and plaintiffs’ “reasonable” attorneys’ fees can be enough to put many  operations out of business. Not included here are the costs of defense counsel,  the hit to the restaurant’s reputation, and the disruption of daily operations.  For many owners, settling the plaintiffs’ claims, regardless of their merit, is  the most reasonable business decision.

Read more: http://www.crainsnewyork.com/article/20120916/OPINION/309169972#ixzz26e5yTkfQ

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by | September 14, 2012 · 6:10 am

Hospitality Industry Property Risks: Las Vegas Hotel "Trash Chute Fire" Caused By Sparks From Workers Grinding Metal; $100,000 In Damage

“…Sprinklers inside the chute activated to control the fire, but firefighters found smoldering material in or around the trash chutes from the second to the ninth floors…sparks produced by workers grinding metal with an industrial tool around the trash chute caused the fire…”

Clark County Firefighters were called Thursday morning to the Strip to extinguish a fire in a trash chute at the Planet Hollywood, which caused an estimated $100,000 in damage.

Firefighters responded to reports of smoke at 10:12 a.m. and discovered the fire, which was quickly contained, in a fifth-floor chute in the north hotel tower, according to Clark County spokesman Dan Kulin.

Heavy smoke was reported on several floors, and the fifth, sixth and seventh floors were evacuated, Kulin said.

For more:  http://www.lasvegassun.com/news/2012/sep/13/planet-hollywood-trash-chute-fire-extinguished/

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by | September 13, 2012 · 6:15 am

Hospitality Industry Legal Risks: Illinois Restaurant Sued For "Negligence" After Repairman "Set On Fire" By Employee; Seeks $50,000 In Damages

“…a recently filed lawsuit argues the East China Inn was negligent, and seeks more than $50,000 in damages…the man was standing on top of the stove inspecting a sprinkler system and changing a fuse…he needed medical treatment for a year…”

A fire suppression repairman has sued the East China Inn restaurant on Randall Road in Batavia, arguing he was set on fire while working during an October 2010 visit. Matthew Rapp, 25, of Oak Forest sustained severe burns to his left leg after someone turned on a wok while Rapp was atop a stove fixing fuses, his attorney said.

“He got burned quite badly,” said attorney Matt Willens, adding Rapp was burned mostly on his left leg from his ankle to his knee. “Because of the burn, he missed 21 weeks of work. He was burned by grease.”

The suit states that Rapp visited the Chinese restaurant on Oct. 12, 2010, for his job with Fire Science Techniques. “A restaurant employee turned on the stove or continued to work on the stove that the plaintiff was working above which set the plaintiff on fire,” the lawsuit states.

For more: http://www.dailyherald.com/article/20120912/news/709129713/

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by | September 12, 2012 · 6:09 am

Hospitality Industry Legal Risks: Kansas Hotel Owners Indicted For Hiring "Undocumented Workers And Paying Them In Cash"; Government Seeks "Forfeiture Of Properties"

“…the (hotel owners) are charged with one count of conspiracy to harbor  undocumented workers for personal gain, five counts of harboring  undocumented workers for personal gain and four counts of wire fraud…The government is seeking to forfeit the proceeds of the crimes, including the two hotels the couple own. The government would seize the properties and then sell them, gaining money for taxpayers. The couple failed to pay the government the payroll taxes that they should have…”

The owners of two Kansas City-area Clarion hotels have been indicted on charges of knowingly hiring undocumented workers who were paid less than other employees. Munir Ahmad Chaudary, 51, and his wife, Rhonda R. Bridge, 40, both of Overland Park, own the Clarion Hotel at 7000 W. 108th St. in Overland Park and the Clarion Hotel at 11828 NW Plaza Circle near the Kansas City International Airport.

Both pleaded not guilty on Tuesday. U.S. Attorney Barry Grissom said the grand jury’s indictment alleges Chaudary and Bridge knew they were hiring undocumented workers to serve as housekeepers. This gave them a competitive advantage over law-abiding hotel owners, Grissom said.

“They paid the undocumented workers less and they paid them in cash. Their economic motive was to cut their costs and to get an advantage on other hotels that abided by the law,” Grissom said.

“This prosecution is aimed at unscrupulous employers who are a driving force behind illegal immigration,” Grissom said. “We’re going to go after people who are hiring them.”

The indictment alleges that in December 2011 investigators from DHS Homeland Security Investigations and the Kansas Department of Revenue received information that the two hotels were employing undocumented workers.

Investigators interviewed hotel employees and found out that most of them were illegally in the United States.

In June 2012, an undercover agent took a job as a housekeeper at the Clarion hotel in Overland Park, Grissom said.

The agent made it clear to Chaudary and Bridge when he was hired that he was unlawfully in the United States and had no documents allowing him to be employed, according to the indictment.

For more: http://www.kctv5.com/story/19512719/us-attorney-barry-grissom-holds-news-conference

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by | September 11, 2012 · 6:10 am

Hospitality Industry Property Risks: West Virginia Hotel Fire Destroys 30 Rooms, Killing One Man

“…Witnesses told authorities the fire appeared to start in the top section of the motel’s west wing, but no cause has been determined… The fire destroyed about 30 rooms…”

The West Virginia Fire Marshal’s Office says a Louisiana man has died of burns he suffered during a weekend hotel fire. Media outlets identified the victim as 21-year-old Dustin McCellen.

The marshal’s office didn’t provide his hometown, and the chief investigator on the Wilsonburg blaze didn’t immediately respond to a message Tuesday.

McCellen was an oil and gas industry worker who was staying at the Towne House West Motor Lodge when it caught fire early Sunday morning.

No one else was injured. Many of the rooms were rented by other gas workers who had gone home for the weekend.

For more:  http://www.wowktv.com/story/19511136/la-gas-worker-dies-of-burns-from-wva-motel-fire

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by | September 8, 2012 · 6:10 am

Hospitality Industry Employee Risks: Restaurant Owners Use "Written Integrity Tests" To Limit High Costs Of "Employee Theft And Drug Use"

“…restaurant  owners  must address ethical issues when evaluating job applicants for  employment.  Historically, employers have relied upon reference checks,  criminal background checks and interviews to address these issues…now a growing number of restaurant owners use written integrity testing  to improve their  ability to screen  out high risk job  applicants…”

Employee theft and other forms of counterproductivity are highly significant  factors in determining the success of restaurants.  While employers tend to  have some awareness of the frequency with which employees engage in theft, drug  use and other counterproductive behaviors, the following research findings are  helpful in providing an objective  perspective of  how  frequently  these problematic behaviors occur:

  • The National Restaurant Association recently reported that the cost of  employee theft for its members is $8.5 billion annually or approximately 4  percent of food sales.
  • A study released in 2007 by the U.S. Substance Abuse and Mental Health  Administration indicated that the highest rate of illicit drug use occurs among  restaurant workers. A whopping 17 percent admitted to illegal drug use in the  last month.

Extensive research documents that integrity tests are good predictors of  whether an individual will engage in various forms of workplace  counterproductivity (e.g., theft, illegal drug use).  Also, these  assessments do not adversely impact minority candidates, which is a major  downside to criminal background checks.  Further, integrity tests are  relatively inexpensive and can be easily administered online. As a result, high  risk applicants can be screened from contention before wasting time and money on  interviews, criminal background checks and reference checks.

Read more at  http://www.business2community.com/human-resources/screening-job-applicants-to-minimize-employee-theft-and-other-forms-of-counterproductivity-in-the-restaurant-industry-0274014#MbysIc4cypbhdqY1.99

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by | September 7, 2012 · 6:20 am

Hospitality Industry Employment Risks: Florida Restaurant Group Faces Lawsuit For "Failing To Pay Minimum Wages" And Forcing Employees To Work "Off-The-Clock" (Video)

The lawsuit accuses the Orlando, Florida-based company of failing to pay federally mandated minimum wages and forcing its waiters and waitresses to work “off-the-clock” before or after their shifts.

[youtube=http://www.youtube.com/watch?v=PoEWJzbMDw0]

The lawsuit accuses the Orlando, Florida-based company of failing to pay federally mandated minimum wages and forcing its waiters and waitresses to work “off-the-clock” before or after their shifts.

Darden Restaurants Inc, best known for its Olive Garden and Red Lobster chains, was hit with a lawsuit in federal court in Miami on Thursday accusing one of the largest U.S. restaurant operators of violating federal labor laws by underpaying workers at its popular eateries across the country.

Filed under the Fair Labor Standards Act, it also claims many Darden employees have failed to receive appropriate overtime wages for work in excess of 40 hours per week.

Only two plaintiffs are named in the 19-page complaint filed on Thursday in U.S. District Court for the Southern District of Florida.

For more:  http://in.reuters.com/article/2012/09/06/usa-darden-lawsuit-idINL2E8K6HAN20120906

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by | September 6, 2012 · 6:07 am

Hospitality Industry Legal Risks: California Restaurant Chain Faces Class Action Lawsuit For "Race, Color And Age Discrimination"

The suit alleges that In-N-Out Burger “recruits, hires and maintains a work force that is predominantly under the age of 40 and/or non-African-American.”…the suit also seeks back pay as well as compensatory damages and punitive damages on behalf of people who have been unlawfully denied employment with In-N-Out Burger.

A Berkeley law firm has filed a class action lawsuit alleging that Irvine-based restaurant chain In-N-Out Burger maintains hiring practices that discriminate on the basis of race, color and age. The suit, which was filed in Alameda County Superior Court on Tuesday, was filed on behalf of two black men from Oakland over the age of 40 who recently applied for jobs at In-N-Out Burger restaurants in Oakland and San Francisco but weren’t hired.

The suit says both men were qualified for the jobs they applied for and alleges that they weren’t hired because of their race and their age.

The restaurant chain has 210 restaurants in California and thousands of employees but the suit charges that “very few” are over 40 and/or black.

Steve Tidrick, the attorney for the plaintiffs, said the suit alleges that In-N-Out Burger has “a pervasive policy of discrimination on the basis of race, color and age” in its hiring practices and seeks to end those practices through injunctive relief.

For more:  http://www.mercurynews.com/breaking-news/ci_21477996/oakland-lawsuit-accuses-n-out-burger-racial-and

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