A New York City bill has sparked controversy among immigrant hotel owners who argue it can severely affect the city’s hospitality industry.
The Safe Hotels Act, sponsored by Councilwoman Julie Menin, seeks to improve health and safety standards in city hotels. Key provisions of the bill include an outsourcing ban on some core hotel functions, including housekeeping and front desk operations, and continuous front desk and security coverage in larger establishments.
The measure also requires hotels to hire services from a single management company. However, subcontracting work is prohibited unless a collective bargaining agreement covers “a majority of all core and critical employees,” including cooks, front desk staff, food handlers, maintenance workers, and security personnel.
NYC hoteliers oppose the Safe Hotels Act
Various hotel owner groups, including the Asian American Hotel Owners Association (AAHOA), American Hotel and Lodging Association, and the newly formed NYC Minority Hotel Association (NYCMHA), have strongly opposed the bill. They argue that banning outsourcing could significantly raise operating costs and threaten the survival of many small hotels.
Mukesh Patel, one of NYCMHA’s founding members, emphasized that the bill could undermine the American Dream for immigrant families who have invested heavily in these businesses. Patel also warned that the legislation could “destroy all of that progress, put thousands of people out of work, and shut down small businesses all over the city.”
Critics believe that requiring hotels to employ core staff directly instead of outsourcing increases labor costs and hinders the competitiveness of smaller hotels. Many of these hotels still need to recover from the COVID-19 pandemic.
“We have not fully recovered from the COVID pandemic,” said Patel, a New York City hotel owner who immigrated from India 30 years ago. “We are still struggling.”
Additionally, he raised concerns about potential unfair license revocations and the risk that banks might be reluctant to finance hotels facing stricter regulations.
Meanwhile, Hotel Association of New York City President and CEO Vijay Dandapani likened the bill to a nuclear bomb. “It will destroy a major segment of the industry,” he said in an earlier interview. “This is a bazooka to kill a gnat.” He added that hotel prices might surge due to the new rules.
License to operate
Currently, hotels need a certificate of occupancy from the Buildings Department and safety approvals from the Fire Department to operate. But the proposed bill requires all city hotels to obtain an operating license annually with a $200 fee, aligning New York with other cities with such a requirement.
Menin argues that this legislation will improve safety standards and ensure accountability within the hotel industry, addressing issues such as sex trafficking and crime. Her proposal has garnered support from the city’s five district attorneys, the Police Benevolent Association, and the Hotel Trades Council (HTC).
As the New York City Council weighs the merits of the bill, the future of the city’s hotel industry remains uncertain, facing a potential conflict between stricter regulations and the economic challenges faced by small businesses.
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Brock, E. (2024, August 28). NEW GROUP FORMS TO PROTEST NYC ‘SAFE HOTELS ACT’. Asian Hospitality. Retrieved from https://www.asianhospitality.com/new-group-forms-to-protest-nyc-safe-hotels-act/
Rozner, L. (2024, August 7). “Safe Hotels Act” would set up licensing system for NYC hotels. How it aims to protect workers, guests. CBS News. Retrieved August 28, 2024, from https://www.cbsnews.com/newyork/news/nyc-safe-hotels-act-hotel-licensing-system/
