Ordinance disrupts labor-management relations Governed by federal labor law

Los Angeles, CA – December 16, 2014 – The American Hotel & Lodging Association (AH&LA) and the Asian American Hotel Owners Association (AAHOA) filed a lawsuit today against the City of Los Angeles challenging a recent Los Angeles ordinance that attempts to exercise power beyond the limits of the City’s authority.

The lawsuit was filed in the federal United States District Court for the Central District of California. The lawsuit seeks to invalidate the Los Angeles ordinance and prevent the City from enforcing its provisions on the grounds that it disrupts the relationship between labor and employers established by the United States Congress.

“For over 50 years, there has been consensus that a single set of rules governing labor relations is good for the long-term best interests of management, unions and workers,” said Katherine Lugar, president and CEO of AH&LA, during a press conference in Los Angeles. “However, the city's ordinance is clearly designed to put a thumb on the scale in favor of labor and disrupts the careful balance between labor and management.”

“Our workers are the backbone of every hotel. We are proud of the opportunities we provide to the hard-working men and women in the hotel sector that enable countless individuals to climb the ladder of opportunity and build life-long careers. We are prepared to work with local officials on a fair, balanced and across-the-board increase but we cannot – and will not -- stand by when recent actions by the city council single out hotels.”

The City’s ordinance includes a so-called “exemption for collective bargaining agreement” that, in reality, empowers unions to waive any part of the new ordinance for any hotel they cover through a collective bargaining agreement. This ability provides unions with dramatically increased leverage to extract concessions from hotel management and to pressure non-union hotels to accept unionization without a vote of the workers of that hotel. This violates fundamental precepts of U.S. labor law and policy.

“We did not come to this decision lightly, but the actions of the City compelled us to seek legal recourse,” continued Lugar. “This ordinance sets a very dangerous precedent, so let me be clear: Wherever these types of egregious and targeted ordinances appear, the hotel industry will respond.”

The suit outlines how the ordinance shifts power in favor of unions seeking to expand their influence in a manner that is inconsistent with the federally established regulation between labor and management. Because those relations cannot be changed at the local level, the ordinance should be invalidated and struck down by the courts.

“The City of Los Angeles is being pulled into taking sides between unions and hotels,” said Chip Rogers, interim president of AAHOA. “The City Council doesn’t have the authority to rewrite federal labor law, and this ordinance effectively gives unions the ability to pick and choose when and where the provisions of this ordinance will be enforced. That’s not right.”

Representatives from local groups and industry leaders were also in attendance. A recent survey of Los Angeles voters shows that 65% of respondents are opposed to raising the minimum wage solely for hotel workers, and are more supportive of the across-the-board minimum wage increase.

The lawsuit is American Hotel & Lodging Association and Asian American Hotel Owners Association v. City of Los Angeles. AH&LA and AAHOA are represented by the law firm Holland & Knight.