Category Archives: Liability

Hospitality Industry Legal Risks: Jury Awards Maryland Woman $225,000 In Nation's Largest "Bed Bug Liability Judgment"

On Thursday, a jury ordered Calidad Furniture & Linen Inc., the store that sold Jackson a pair of wood-frame beds, to pay Jackson and her sons $225,000 for the ordeal. It is one of the largest bedbug liability judgments in the country.

Multimillion-dollar lawsuits over bedbugs have become increasingly common as infestations have spread across the country and victims seek to hold landlords, hotels and retailers responsible for their exterminator bills and mental anguish.

But a public judgment is rare in bedbug liability cases. Lawsuits seeking millions of dollars in damages have received publicity in recent years, such as several filed against the Waldorf-Astoria hotel in New York. But most fade away with confidential settlements.

In July 2010, Adarien Jackson’s 6-year-old son, Kaden, began complaining of itchy bumps on his ankles. They soon turned into a rash and spread to his back, behind his ear, and on his eyelid.

The child’s pediatrician and dermatologists tried allergy drugs, diet changes, oils and oatmeal baths. But it wasn’t until months later that Jackson discovered the cause of the problem. Kaden’s twin brother, Kyler, began waking in the middle of the night, crying out, “Bugs are crawling on me!”

Jackson realized her sons’ beds — which she had recently purchased from a furniture store in Elkridge — were teeming with bedbugs, according to a lawsuit she filed in Anne Arundel County in December 2010.

 

For more:  http://articles.baltimoresun.com/2012-03-09/news/bs-md-bed-bug-verdict-20120309_1_bedbug-infestation-bunk-beds-bed-wetting

Comments Off on Hospitality Industry Legal Risks: Jury Awards Maryland Woman $225,000 In Nation's Largest "Bed Bug Liability Judgment"

Filed under Guest Issues, Health, Injuries, Liability, Management And Ownership, Risk Management

Hospitality Industry Legal Risks: California Hotel Owner Charged With "Insurance Fraud" Over False Workers' Compensation Records

“…accusations that he dissuaded an employee from seeking workers’ compensation after a work injury and making false claims. The charges against him include two counts of insurance fraud, failure to maintain workers’ compensation insurance and passing bad checks…”

“…accused of paying approximately $890,000 less than he should have over a four-year period,,,”

The trial date for the owner of the troubled Brookdale Inn & Spa has been postponed because the District Attorney’s Office has filed more charges. Sanjiv Kakkar originally was scheduled to begin trial March 12 on accusations that he dissuaded an employee from seeking workers’ compensation after a work injury and making false claims. The charges against him include two counts of insurance fraud, failure to maintain workers’ compensation insurance and passing bad checks, according to Kelly Walker, a prosecutor with the Santa Cruz County District Attorney’s Office.

Walker has just filed new insurance fraud charges against Kakkar and his wife, Neelam Kakkar, pertaining to insurance premiums. Kakkar is accused of providing false wage information to insurance companies to obtain lower premiums. In other words, he “grossly understated” the amount of payroll he was paying to his employees. He stands accused of paying approximately $890,000 less than he should have over a four-year period, according to Walker.

For more:  http://www.mercurynews.com/breaking-news/ci_20133381/das-office-files-more-insurance-fraud-charges-against

Comments Off on Hospitality Industry Legal Risks: California Hotel Owner Charged With "Insurance Fraud" Over False Workers' Compensation Records

Filed under Crime, Insurance, Labor Issues, Liability, Management And Ownership

Hospitality Industry Fire Risks: "Fire Safe Hotels" Are Listed On FEMA "Hotel-Motel National Master List"

CLICK ON "HOTEL" TO VISIT NATIONAL FIRE SAFE HOTEL SITE

Comments Off on Hospitality Industry Fire Risks: "Fire Safe Hotels" Are Listed On FEMA "Hotel-Motel National Master List"

Filed under Fire, Liability, Maintenance, Management And Ownership, Technology

Hospitality Industry Employment Risks: Hotel Management Compliance Audits Can Expose Potential Labor Department "Wage And Hour Division" Violations

• Make sure nonexempt employees are paid the required minimum wage. The current federal rate is $7.25 per hour (some jurisdictions require a higher rate).  Review deductions to ensure that they do not cut employees’ pay below the minimum wage.
• Be certain nonexempt employees are paid the required overtime. Ensure that all bonuses, shift differentials, service charges and other payments are properly included in computing overtime and that deductions do not improperly cut into overtime pay. 
• Pay special attention to whether nonexempt employees accurately record all worktime. Nonexempt employees must record pre- and post-shift work; shift-change overlap; opening or closing activities; compensable training time, meeting time, “on-call” work; and time spent doing work at home. Employees must record meal time and other non-compensable break time, and they must be paid when they do not take that time off. 
• Be sure that all “exempt” employees meet the requirements for exemption. Review the criteria defining who may be treated as exempt from the Fair Labor Standard Act’s minimum-wage and/or overtime requirements. “Salaried” employees are not necessarily exempt. Certain positions such as sous chefs and sales managers are vulnerable to challenge. 
• Make certain that exempt employees are paid on a salary basis. The most common FLSA exemptions require that such employees be paid on a “salary basis” and thus receive a fixed, predetermined amount for every workweek in which the employee performs any work, without regard to the number of days or hours worked or the quality of work. Salary deductions are very limited. 
• Strictly comply with child-labor restrictions. There is an age 16 limit for general occupations and an age 18 limit for occupations declared “hazardous” by the U.S. Secretary of Labor. 14 and 15 year olds may be employed in limited occupations, within strict hours and times of day limitations. Identify every employee who is 16 or 17, verify his or her age and exact duties. Identify every employee under 16, verify his or her age, exact duties and hours and times of work.
• Comply with all state and local wage-hour requirements. The FLSA does not preempt tougher state or local provisions. These other laws might include a higher minimum wage; daily overtime; minimum pay for reporting to work; more rigorous child-labor limitations; prohibitions on wage deductions; and time limits for paying employees who resign or are fired.

For more:  http://www.hotelnewsnow.com/Articles.aspx/7679/Government-audits-Get-your-house-in-order

Comments Off on Hospitality Industry Employment Risks: Hotel Management Compliance Audits Can Expose Potential Labor Department "Wage And Hour Division" Violations

Filed under Labor Issues, Liability, Maintenance, Management And Ownership, Risk Management, Training

Hospitality Industry Legal Risks: Illinois Hotel Sued For $75,000 By Woman Claiming Bartender Drugged And Sexually Assaulted Her

“…The bartender got a key to the woman’s room from the front desk staff and sexually assaulted her as she was passed out in the room, according to the lawsuit…”

“…The suit names the hotel as the defendant, claiming the staff was negligent in allowing the bartender access to the woman’s room. The suit seeks payment in excess of $75,000 plus the cost of court fees…”

A Virginia woman filed a lawsuit against a Lisle hotel claiming a bartender drugged her drink and later sneaked into her room with the help of a front desk clerk and sexually assaulted her.

The lawsuit, which was filed in federal court Wednesday, claims a 31-year-old bartender slipped a date-rape drug into the woman’s drink while she was at the Lisle-Naperville Hilton on Oct. 27. The woman began to feel ill at around 1:30 or 2 p.m. and went up to her room before her food had arrived at the hotel bar, said her attorney Jeffrey Deutschman.

For more:  http://www.dailyherald.com/article/20120229/news/702299617/

Comments Off on Hospitality Industry Legal Risks: Illinois Hotel Sued For $75,000 By Woman Claiming Bartender Drugged And Sexually Assaulted Her

Filed under Crime, Insurance, Labor Issues, Liability, Management And Ownership

Hospitality Industry Employee Risks: Labor Department Orders South Dakota Hotel To "Pay Back 72 Foreign Workers" For "Impermissible Recruitment Fees"

“…since 2009 Labor Department rules have required businesses to agree it “has contractually forbidden any foreign labor contractor or recruiter whom the employer engages in international recruitment of H-2B workers to seek or receive payments from prospective employees.”

“…Global Employment Agency required impermissible payments from prospective employees from $530 to $1,500…”

The Labor Department announced it had ordered Custer State Park Resorts to pay back $93,000 to its 72 foreign workers hired for the 2010 tourism season. The payments covered impermissible recruitment fees and unpaid overtime. The department fined Custer State Park Resorts an additional $65,000 in civil penalties, which it is appealing. Each year, Custer State Park Resorts hires about 375 to 400 employees, with fewer each year being guest workers, Schmaltz said.

Schmaltz said the unpaid overtime resulted from confusion in the guest worker rules. The bulk of the Labor Department fine Schmaltz said – roughly $60,000 – is repayment for fees taken by Kaubisch.

“We relied too heavily on this vendor who was supposed to know the laws and regulations,” Schmaltz said. “We put too much faith into what Scott knew.”

Kaubisch said he charged the fees to workers “to take care of them.” He took phone calls at all hours, arranged rides and helped secure housing for guest workers. It wasn’t until the investigation last spring, Kaubisch said, that Labor Department officials told him collecting fees was illegal.

Read more: http://rapidcityjournal.com/news/employers-ordered-to-pay-back-foreign-staff/article_1eea0e92-65a9-11e1-886a-001871e3ce6c.html#ixzz1oA6hDlvr

Comments Off on Hospitality Industry Employee Risks: Labor Department Orders South Dakota Hotel To "Pay Back 72 Foreign Workers" For "Impermissible Recruitment Fees"

Filed under Labor Issues, Liability, Management And Ownership, Risk Management, Training

Hospitality Industry Social Media Risks: Hotel Management Faces Legal Issues With Regard To "Relationships" Of Employees Discovered On Facebook

While platforms such as Facebook and Twitter present new opportunities for training and engaging with employees, they also bring new challenges and wrinkles to the age-old workplace policies and practices…(such as)… two of your most exemplary employees who work the front desk..(who)… one day via a Facebook update… entered into a relationship despite your hotel’s strict policy against it…”

“…A user who posts something on Facebook without the proper security filters does so with no expectation of privacy…”

The above scenario was one of many social-media quandaries presented during a table-top summit Tuesday at the 6th Annual HR in Hospitality Conference & Expo.

In this situation, you could fire Johnny, according to Gregg Gilman, an attorney with New York-based Davis & Gilbert LLP. A user who posts something on Facebook without the proper security filters does so with no expectation of privacy, he said. Thus, you treat the case as if you discovered the illicit relationship in one of the “old-fashioned” ways, such as hearing about it from another employee or observing certain tip-offs. 

“You have this new medium, but the same old rules apply,” Gilman said. “… If you operate by those rules, you’re going to be OK.”

Robert Mellwig, VP of HR for Englewood, Colorado-based Destination Hotels, agreed. “We don’t want to get distracted around the technologies,” he said. “… It could easily happen in any other form.”

Where an employer might get into trouble is if they “friend” an employee on Facebook under false pretences for the sole purpose of uncovering activity that runs counter to workplace policy, Gilman said.

For more:  http://www.hotelnewsnow.com/Articles.aspx/7665/Social-media-brings-new-legal-issues-to-hotels

Comments Off on Hospitality Industry Social Media Risks: Hotel Management Faces Legal Issues With Regard To "Relationships" Of Employees Discovered On Facebook

Filed under Labor Issues, Liability, Management And Ownership, Privacy, Risk Management, Technology, Training

Hospitality Industry Legal Risks: Florida Hotel Sued By U.S. Dept Of Labor For "Dodging Taxes By Paying Employees Entirely In Cash" And Denying Overtime

“…The U.S. Department of Labor says the Cavalier Hotel and Crab Shack on Ocean Drive owes its employees $160,000 and that owner Ralph Abravaya skirted taxes by paying his employees in tips and refusing them overtime pay…”

“…Department of Labor’s Wage and Hour Division, says a two-year investigation revealed Abravaya had dodged taxes by paying employees entirely in cash. He also underpaid them by denying them overtime when they worked more than 40 hours per week..”

An art deco hotel on South Beach is locked in a battle with the federal government over the kind of accusations that have gotten the 99 percent so riled up recently.

 “Yeah we screwed up,” Abravaya admits to Riptide. “Alright, so slap me in the hand. But don’t tell me you are going to destroy the business or fine me $300,000. If Abravaya loses in court, he will have to pay a total of $320,000 in fines and unpaid wages, plus court costs.

The hotelier admits that a manager did falsify records in an attempt to escape investigation. But Abravaya says he fired the employee as soon as he learned of the deception. He insists that when he took over the hotel and restaurant in 2009, he simply continued the policy set by the previous owner and paid the employees $6 an hour plus their tips — more than they were owed by law.

For more:  http://blogs.miaminewtimes.com/riptide/2012/03/cavalier_hotel_and_crab_shack.php

Comments Off on Hospitality Industry Legal Risks: Florida Hotel Sued By U.S. Dept Of Labor For "Dodging Taxes By Paying Employees Entirely In Cash" And Denying Overtime

Filed under Labor Issues, Liability, Management And Ownership, Risk Management

Hospitality Industry Information Risks: Hotel's Store "Enormous Amounts Of Data" That Is Never Used; 100% At Risk And 0% Value

“…companies can go a long way toward reducing their exposure to significant losses resulting from a security breach by putting themselves on a “data diet…There is an enormous amount of information that we never use, but we never get rid of. It’s 100% risk and 0% value. As a risk manager, that’s the scariest equation you’re ever going to hear…”

While there is no way for companies to completely eliminate the risk of data breaches and cyber attacks, there are several steps they can take to reduce their potential financial and reputational losses, a panel of experts said Thursday at the third annual Business Insurance Risk Management Summit®in New York.

“The fact is that you’re going to be attacked. That’s the reality,” said Alan Brill, senior managing director of secure information services for New York-based Kroll Inc. A well-crafted cyber risk management program need not be wildly expensive or complex, Mr Kroll said, but should at least strive for “commercially reasonable levels” based on company size and industry.

For more:  http://www.businessinsurance.com/article/20120229/NEWS06/120229881?tags=|338|299|302|342|303|335

Comments Off on Hospitality Industry Information Risks: Hotel's Store "Enormous Amounts Of Data" That Is Never Used; 100% At Risk And 0% Value

Filed under Guest Issues, Insurance, Labor Issues, Liability, Maintenance, Management And Ownership, Privacy, Risk Management, Technology, Theft

Hospitality Industry Fire Risks: Hawaii Hotel Restaurant Fire Caused By "Gas Leak Behind Oven"; Originally Thought To Have Started In Grease Trap

“…Firefighters originally believed the fire had been started in the oven’s grease trap. However, twenty minutes later the fire reignited… Firefighters then discovered a gas leak behind the oven. Gas service was cut off to the restaurants fed by the line, and the fire extinguished…”

Fire safety officials will return to the Ala Moana Hotel later Wednesday after a fire broke out overnight at the Royal Garden Chinese Restaurant inside the hotel.  When firefighters arrived at the hotel shortly before 2 a.m., they found hotel staff using fire extinguishers to put out flames on the third floor restaurant.A hotel guest told KITV4’s Ryan Kalei Tsuji he was never alerted by a fire alarm. 
 
 The Ala Moana Hotel said an initial alarm was sounded, but the fire was quickly contained so guests could remain in their rooms. The hotel said the Honolulu Fire Department determined that a hotel evacuation was not necessary.Read more: http://www.kitv.com/news/30515611/detail.html#ixzz1nVKkYksE

Comments Off on Hospitality Industry Fire Risks: Hawaii Hotel Restaurant Fire Caused By "Gas Leak Behind Oven"; Originally Thought To Have Started In Grease Trap

Filed under Fire, Insurance, Liability, Maintenance, Management And Ownership, Risk Management