Category Archives: Management And Ownership

by | December 17, 2012 · 7:00 am

Hospitality Industry Property Risks: Superstorm Sandy "Flood Insurance Claims" In New York And New Jersey Exceed Total For Hurricane Katrina In 2005; Federal Flood Insurance Program Only Product Available

The NFIP provides insurance for homes and businesses in flood prone areas, such as Cape May County. Created in 1969 to fill the gap after private insurers declined to continue coverage for property owners in flood-prone flood insuranceareas, it now covers more than 5.6 million policyholders in 21,000 flood-prone communities.

“The federal flood insurance product is the only product available,” 

By the end of the second day after Superstorm Sandy’s powerful storm surge overwhelmed coastal areas of New York and New Jersey, the National Flood Insurance Program had already recorded more flood claims than the total for Hurricane Katrina, a storm that devastated the Gulf Coast in 2005.

William McMahon III, president of the McMahon Agency Insurance in Ocean City, said Sandy has since far surpassed the notorious Katrina.

Katrina, he said, delivered both flood and wind damage. Sandy’s damage was primarily from flooding. Few claims, he said, have been filed for wind damage.

Not long after Katrina, Hurricane Wilma tore across southern Florida, causing massive destruction.

“Wilma was a small storm. It came across the state from the gulf blowing about 70 mph, but the wind did major damage by the time it hit Miami,” McMahon said. “The wind ripped through all the high rises with 100 mph winds.”

In the wake of those two storms, barely two months apart, insurance companies bailed out of writing property and casualty insurance policies in some areas of Florida. The state of Florida, he said, instituted its own carrier, Citizens, now the largest underwriter in the state.

Florida and Louisiana, he said, are the two most difficult states to obtain property insurance. While flood insurance is available in Florida, it is expensive, particularly close to the coast.

For more: http://www.shorenewstoday.com/snt/news/index.php/ocean-city-general-news/32569-flood-insurance-claims-from-sandy-top-katrina.html

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by | December 16, 2012 · 9:14 am

Hospitality Industry Insurance Risks: Pending Legislation Before Congress Deals With Medicare Payments, Workers' Compensation And Liability Insurance Claims

“…the Medicare Secondary Payer and Workers’ Compensation Settlement Agreements Act of 2012…deals only with workers’ compensation claims, and seeks to establish clear and consistent rules for workers’ workers comp medicalcompensation set-asides for claimants covered by Medicare…”

“…The Strengthening Medicare and Repaying Taxpayers Act…deals with issues related to the Medicare Secondary Payment Act. Specifically, it deals with mandates for providing timely information on conditional payments, penalties and statutes of limitations when claims are reported to the Centers for Medicare and Medicaid Services by insurers and self-insured and third-party payers on no-fault auto-insurance claims, workers’ compensation claims, and claims under liability insurance…”

Insurance and related industries are seeking to win support in the waning days of the current Congress for two pieces of legislation dealing with payment of injured worker claims to people whose primary insurance is Medicare. Officials of both the American Insurance Association and the Property Casualty Insurers Association of America are urging action on the bills this year.

Nathaniel Wienecke, PCI senior vice president, Wednesday asked officials of the Senate Finance Committee and the House Ways and Means Committee if it could act on the bill this year.

Currently, workers’ compensation claims that overlap with Medicare coverage are subject to lengthy, cumbersome review by the Centers for Medicare and Medicaid Services to establish the proper “set-side” coverage amounts for future medical expenses, according to PCI officials.

For more:  http://www.propertycasualty360.com/2012/12/14/insurance-reps-push-for-action-on-medicare-seconda?t=commercial

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by | December 15, 2012 · 12:59 pm

Hospitality Industry Legal Risks: Restaurant Owners Should Provide Comprehensive Employee Handbooks That Describe Employees' Rights, Expectations And Company Obligations

Small Business AdministrationAn employee handbook is an important communication tool between you and your employees. A well-written handbook sets forth your expectations for your employees, and describes what they can expect from your company. It also should describe your legal obligations as an employer, and your employees’ rights. This guide will help you write an employee handbook, which typically includes the topics below.

Anti-Discrimination Policies

Compensation

Work Schedules

  • Work hours and schedules
  • Attendance, punctuality and reporting absences
  • Guidelines for flexible schedules and telecommuting.

Standards of Conduct

  • Dress code and ethics
  • Legal obligations

General Employment Information

Safety and Security

For more: http://www.sba.gov/content/employee-handbooks

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

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by | December 14, 2012 · 7:05 am

Hospitality Industry Security Risks: Hotel Electronic Door Locks In "Various Stages Of Being Repaired"; "Mechanical Caps And Security Screws" Provided To Block Hackers

In October, hotel insurance-related company Petra Risk Solutions issued its hotel clients an alert headlined, “Crime Alert – Onity Guestroom Door hackers are for real.”

Onity Electronic LockIn Florida, Petra loss prevention expert Todd Seiders said he received reports that a hacker had been seen carrying a laptop and using a key card – possibly connected to the laptop – to open locked guestroom doors.

The locks on more than 1 million guestroom doors are in various stages of being repaired, following the revelation this summer that they may be vulnerable to hackers.

The New York Marriott Marquis, the biggest hotel in Manhattan, for instance, just completed updating all of its nearly 2,000 door locks. The hotel is one of thousands of properties with guestroom locks manufactured by Onity, a division of United Technologies. An Onity website also shows Sheraton, Hyatt, Holiday Inn, Fairmont, Radisson and other well-known hotels from Paris to Perth as also having its locks updated.

The hacking tool, according to Petra’s alert, could be made for about $50 in easy-to-acquire electronic parts.

“Please train and notify your hotel staff that these burglaries are spreading across the country,” Petra’s alert cautioned hoteliers. “Hotel staff should be vigilant while they are on the guest floors and paying attention to guests walking through hallways…Take time to watch guests walking through your hallways to ensure they are going to a room and entering it. Be very suspicious of someone carrying a laptop or small bag wandering the hallways. Greet guests and ask them if they need assistance.”

Onity did not immediately return an e-mail seeking comment about the issue. But in a statement updated for December on its website, Onity says that as of Nov. 30, it has shipped hardware to fix 1.4 million hotel door locks. The hardware includes mechanical caps and security screws that “block physical access to the lock ports that hackers use to illegally break into hotel rooms.”

For more:  http://www.usatoday.com/story/hotelcheckin/2012/12/14/hotels-fixing-flaw-that-made-room-locks-vulnerable-to-hackers/1769081/

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Filed under Crime, Guest Issues, Liability, Maintenance, Management And Ownership, Risk Management, Technology, Theft

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by | December 13, 2012 · 7:42 am

Hospitality Industry Employment Risks: California Restaurants In "Well-Known Tourist Areas" Investigated By U.S. Dept. Of Labor Agree To Pay $670,000 In "Unpaid Minimum Wages And Overtime"

“…(Wage and Hour Division investigators)…found widespread labor violations among restaurants in well-known tourist areas in San Francisco and throughout Los Angeles County…culture of noncompliance Hospitality Industry Wage and Hour Litigationadversely impacts the wages and working conditions of many low-wage, vulnerable workers…”

Wage and Hour Division investigators with the U.S. Department of Labor conducted comprehensive reviews of payroll records and employment practices in both San Francisco and Los Angeles, in addition to employee interviews, and found that restaurants were violating minimum wage, overtime and record-keeping provisions.

As a result, 273 restaurant workers will divvy up $672,333 in unpaid minimum wages and overtime compensation, according to the feds.

The Fair Labor Standards Act requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as time-and-a-half of their regular rates for hours worked over 40 per week. The law also says employers must keep accurate records of employees’ wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law. If employers don’t abide by these rules, they are liable to pay back wages and an equal amount in liquidated damages to employees.

For more:  http://blogs.sfweekly.com/thesnitch/2012/12/restuarant_workers_wage_and_hour_division.php

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by | December 12, 2012 · 7:22 am

Hospitality Industry Theft Risks: Illinois Restaurant Manager Charged With Stealing Over $10,000 In Employee Paycheck Scam; Forged Names On Bogus Paychecks

“…she allegedly used information records of at least four former workers to pull off the scam, which came to light only after one of those former workers took concerns to the restaurant’s owner…created the accounts, employee theft“clocked in” workers to show they worked certain hours and then forged their names on the resulting paychecks…”

The manager of the Jerseyville McDonald’s restaurant was charged this week, accused of theft for allegedly using former workers’ information to create bogus paychecks that she cashed for herself.

The amount of money involved is likely in the tens of thousands of dollars, although Jersey County State’s Attorney Ben Goetten said the case still is being investigated.

“This should be a wake-up call to other business owners out there,” he told The Telegraph.

Officially, the amount of money taken is listed in the charge as between $10,000 and $100,000.

The alleged victim, Lora Dover of Carrollton, said she became alarmed after being told by Medicaid that she was not eligible for her latest disability check because of unreported income from 2012. Turns out, she had not worked at the McDonald’s in 2012.

For more:  http://www.thetelegraph.com/news/local/article_8692a192-43e5-11e2-b4f6-001a4bcf6878.html

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by | December 11, 2012 · 6:50 am

Hospitality Industry Legal Risks: New Jersey Hotel Sued For "Negligence" By Man Who Suffered Brain Damage In Pool Incident; "Staff Wasn't Prepared To Handle Drowning Emergency"

“…the plaintiff’s attorney, said his clients’ case also is based on a claim that the hotel’s staff wasn’t prepared to handle a drowning emergency. Hotels aren’t required to employ lifeguards but they must designate someone Pool safety No Lifeguard Signas a “certified pool operator.” In this case, the pool operator, an assistant manager, was present when plaintiff went under…but because plaintiff was unresponsive on the pool bottom by the time the pool operator pulled Brianna out of the water, and because the pool operator himself couldn’t swim, he was unable to rescue Smith before he suffered brain damage…”

A Georgia man who suffered permanent brain damage while trying to save his daughter in a hotel swimming pool was the victim of negligent owners who failed to ensure the pool area was safe, a lawyer for the plaintiff said Monday during opening arguments in the civil trial.

Robert A. Smith, 40, was overcome by water on July 4, 2009, when he tried to save his 11-year-old daughter, Brianna, after she drifted into the deep end of the Ramada Inn poll in Rochelle Park. Safeguards that should have been in place – such as visual cues indicating the water’s depth and a “life line” separating the shallow and deep ends – were missing. In combination with a pool bottom that was steeper than it should have been, the result was a “perfect storm” for hotel guests who couldn’t swim, said Greg Haddad, an attorney for Smith’s family.

“This facility, its pool, were operated in a negligent manner,” Haddad told a jury in state Superior Court in Hackensack on Monday. “The focus of this company and these people was to make money at the complete disregard for [the safety of] customers.”

The family of Robert Smith, who remains in a “minimally-conscious state” in a nursing home, is suing the owner of the Ramada Inn, Ratan R. Park, LLC., for damages, said Haddad.

In a recording of the 911 call reporting the drowning, the caller tells the emergency operator, “Somebody’s drowning inside the water. … Nobody can swim here.” Eventually, another hotel guest dove in the water to save Smith.

Smith’s condition is stable, Haddad said, and his doctors believe he could live for another 20 or 25 years. His family is asking for at least enough money to cover his medical expenses, which will amount to $7 million over his lifetime if he is cared for at home, and $12 million if he remains in a nursing home, Haddad said.

For more:  http://www.northjersey.com/news/Lawyers_debate_Rochelle_Park_hotels_liability_in_swimming_pool_case.html

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by | December 8, 2012 · 7:20 am

Hospitality Industry Legal Risks: Illinois Restaurant Sued For Negligence By Woman Who Slipped On "Wet And Slick Floor"; Lawsuit Seeks $50,000 In Medical Costs And Damages

“…as she was walking to the restroom, (the woman) slipped on a wet and slick floor…she suffered severe pain slip_and_fall accidentand discomfort, incurred medical costs and endured damages of more than $50,000, the suit states…”

A woman claims she suffered severe injuries after she slipped and fell on a wet floor at a restaurant. Janet L. Althoff filed a lawsuit Nov. 26 in Madison County Circuit Court against Ali Veseli doing business as Round Table Family Restaurant.

Althoff claims she was visiting Round Table at about 2:30 p.m. on March 9 when she walked from a dining room to a unisex restroom.

Althoff blames Veseli for causing her injuries, saying the restaurant negligently failed to correct the unsafe condition and failed to warn of the wet floor. In her complaint, Althoff seeks an unspecified judgment, plus other relief the court deems just.

For more:  http://madisonrecord.com/issues/366-personal-injury/250097-round-table-family-restaurant-sued-by-woman-who-claims-she-slipped-on-wet-floor

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by | December 4, 2012 · 8:02 am

Hospitality Industry Legal Risks: Kentucky Restaurants Sued By Cities For "Multiple False Alarms"; Thousands Of Dollars In Unpaid Fines

“…The city has filed 37 lawsuits in recent weeks — with at least 13 more pending — against the most egregious offenders, seeking thousands of dollars in unpaid fines and hoping to send a message about fixing alarms that False_Alarmswaste police time and cost taxpayer dollars…”

More than 40 times since 2008, Louisville Metro Police Department officers have made emergency runs to the Taco Bell on East Broadway, only to find they were responding to a false alarm.

Under a policy enacted in June 2005 that aims to crack down on residents and businesses who have multiple false alarms, the city has fined the Taco Bell — repeatedly — up to $500 per false alarm.

But the restaurant, like some others, has not paid its fines, which now total $10,700, according to city records.

Before police began charging fees for false burglary and hold-up alarms in 2005, officers were responding to more than 40,000 false alarms a year, Gibson said. Since then, that number has fallen dramatically, with less than 20,000 false alarm runs through October of this year.

For more:  http://www.courier-journal.com/article/20121203/NEWS01/312030096/City-sues-collect-false-alarm-fines?odyssey=nav|head

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by | December 1, 2012 · 7:18 am

Hospitality Industry Legal Risks: Hotels Warned By Federal Trade Commission (FTC) For "Deceptively Low" Estimates Of Room Costs; Undisclosed "Resort Fees" May Violate Law

 “One common complaint consumers raised involved mandatory fees hotels charge for amenities such as newspapers, use of onsite exercise or pool facilities, or internet access, sometimes referred to as ‘resort fees.’  FTCThese mandatory fees can be as high as $30 per night, a sum that could certainly affect consumer purchasing decisions.”

The Federal Trade Commission has warned 22 hotel operators that their online reservation sites may violate the law by providing a deceptively low estimate of what consumers can expect to pay for their hotel rooms.

The warning letters cited consumer complaints that surfaced at a recent conference the FTC held on “drip pricing,” a pricing technique in which firms advertise only part of a product’s price and reveal other charges as the customer goes through the buying process.   The warning letters also state that consumers often did not know they would be required to pay resort fees in addition to the quoted hotel rate.

“Consumers are entitled to know in advance the total cost of their hotel stays,” said Federal Trade Commission Chairman Jon Leibowitz.  “So-called ‘drip pricing’ charges, sometimes portrayed as ‘convenience’ or ‘service’ fees, are anything but convenient, and businesses that hide them are doing a huge disservice to American consumers.”

The letters strongly encourage the companies to review their websites and ensure that their ads do not misrepresent the total price consumers can expect to pay.

For more:  http://www.ftc.gov/opa/2012/11/hotelresort.shtm

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