Category Archives: Risk Management

by | April 13, 2012 · 1:21 am

Hospitality Industry Employee Risks: California Hotels And Restaurants Are "Not Obligated To Ensure Workers Take Legally Mandated Lunch Breaks"; Unanimous Opinion By State Supreme Court

“…the high court sided with businesses when it ruled that requiring companies to order breaks is unmanageable and those decisions should be left to workers. The decision provided clarity that businesses had sought regarding the law…”

In a case that affects thousands of businesses and millions of workers, the California Supreme Court ruled Thursday that employers are under no obligation to ensure that workers take legally mandated lunch breaks.

The unanimous opinion came after workers’ attorneys argued that abuses are routine and widespread when companies aren’t required to issue direct orders to take the breaks. They claimed employers take advantage of workers who don’t want to leave colleagues during busy times.

The case was initially filed nine years ago against Dallas-based Brinker International, the parent company of Chili’s and other eateries, by restaurant workers complaining of missed breaks in violation of California labor law.

The opinion written by Associate Justice Kathryn Werdegar explained that state law does not compel an employer to ensure employees cease all work during meal periods. Instead, an employee is at liberty to use the time as they choose, she wrote.

For more:  http://finance.yahoo.com/news/court-managers-dont-ensure-lunch-breaks-181751682.html

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by | April 12, 2012 · 1:10 am

Hospitality Industry Information Technology Risks: Hotel And Restaurant "POS Systems" Are The #1 Target Of Criminal Data Breaches

If a criminal can breach a system in the restaurant, they also have access to the front desk, the spa and any other connected system. The risk is even greater when hotels are part of a hotel chain with interconnected systems.

Franchise businesses are particularly at risk primarily because franchises tend to have the same POS system duplicated at all locations. If a cybercriminal can figure out a way to breach one, in all likelihood, they can replicate the attack at other locations.

In 2011, Trustwave SpiderLabs conducted 42 percent more data breach investigations than in the previous year. More than 85 percent of these data breaches occurred in the food and beverage, retail and hospitality industries.

Why the focus on these industries? There are several reasons, but the number one is that they all process credit cards. In our investigations, we found that the vast majority of assets targeted by criminals were point-of-sale software systems (75 percent of cases). Think of the scenario of a hotel that maintains a restaurant, a spa, as well as other services all connected to one POS system.  We’ve investigated cases where the criminal breaches the environment at one location and was in turn able to connect todozens of others through the wide area network used by the hotel chain.

For more:  http://www.forbes.com/sites/ciocentral/2012/04/11/restaurants-beware-hackers-want-your-customer-data/

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by | · 1:10 am

Hospitality Industry Information Technology Risks: Hotel And Restaurant "POS Systems" Are The #1 Target Of Criminal Data Breaches

If a criminal can breach a system in the restaurant, they also have access to the front desk, the spa and any other connected system. The risk is even greater when hotels are part of a hotel chain with interconnected systems.

Franchise businesses are particularly at risk primarily because franchises tend to have the same POS system duplicated at all locations. If a cybercriminal can figure out a way to breach one, in all likelihood, they can replicate the attack at other locations.

In 2011, Trustwave SpiderLabs conducted 42 percent more data breach investigations than in the previous year. More than 85 percent of these data breaches occurred in the food and beverage, retail and hospitality industries.

Why the focus on these industries? There are several reasons, but the number one is that they all process credit cards. In our investigations, we found that the vast majority of assets targeted by criminals were point-of-sale software systems (75 percent of cases). Think of the scenario of a hotel that maintains a restaurant, a spa, as well as other services all connected to one POS system.  We’ve investigated cases where the criminal breaches the environment at one location and was in turn able to connect todozens of others through the wide area network used by the hotel chain.

For more:  http://www.forbes.com/sites/ciocentral/2012/04/11/restaurants-beware-hackers-want-your-customer-data/

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by | April 11, 2012 · 11:03 am

Hospitality Industry Legal Risks: Hotel And Restaurant Owners Should Consider Requiring Employees To Sign Arbitration Agreements Containing "Class Action Waivers"

“….conducting a wage and hour audit and educating management on wage and hour best practices…(and) requiring employees to sign arbitration agreements containing class action waivers…(can help) prevent employees from asserting wage and hour claims in the form of a class action lawsuit…”

Class action waivers received a boost by the U.S. Supreme Court last year in a widely publicized consumer class action case in which the court found them to be legally enforceable in a mandatory arbitration agreement. The AT&T Mobility v. Concepcion decision has caused some employers to consider including class action waiver language in employee arbitration agreements to prevent class/collective wage and hour lawsuits. However, courts are still struggling with the issue of whether the right to proceed as a class/collective action can be waived under the Fair Labor Standards Act.

Waivers will be more likely to be upheld where they contain provisions providing fair relief for the employee, such as:

  • Employee chooses the venue for dispute resolution;
  • Employee is entitled to injunctive relief and punitive damages, if applicable; or
  • Employer pays some or all of the costs of the dispute resolution and/or waives claims for its own costs and fees.

For more:  http://www.lexology.com/library/detail.aspx?g=0345c278-07bc-4308-bdf2-7c7b16f0ba84

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by | · 11:03 am

Hospitality Industry Legal Risks: Hotel And Restaurant Owners Should Consider Requiring Employees To Sign Arbitration Agreements Containing "Class Action Waivers"

“….conducting a wage and hour audit and educating management on wage and hour best practices…(and) requiring employees to sign arbitration agreements containing class action waivers…(can help) prevent employees from asserting wage and hour claims in the form of a class action lawsuit…”

Class action waivers received a boost by the U.S. Supreme Court last year in a widely publicized consumer class action case in which the court found them to be legally enforceable in a mandatory arbitration agreement. The AT&T Mobility v. Concepcion decision has caused some employers to consider including class action waiver language in employee arbitration agreements to prevent class/collective wage and hour lawsuits. However, courts are still struggling with the issue of whether the right to proceed as a class/collective action can be waived under the Fair Labor Standards Act.

Waivers will be more likely to be upheld where they contain provisions providing fair relief for the employee, such as:

  • Employee chooses the venue for dispute resolution;
  • Employee is entitled to injunctive relief and punitive damages, if applicable; or
  • Employer pays some or all of the costs of the dispute resolution and/or waives claims for its own costs and fees.

For more:  http://www.lexology.com/library/detail.aspx?g=0345c278-07bc-4308-bdf2-7c7b16f0ba84

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by | April 10, 2012 · 1:36 am

Hospitality Industry Crime Risks: "Large Identity Theft Operation" Uncovered At California Hotel After Manager Suspected Drug Sales

“…Deputies found fake credit and identification cards as well as computers, printers and software used to make false identification..Deputies also found credit card readers and small cameras that allowed criminals to capture credit card information and PIN numbers. Prepaid credit cards embossed with stolen information which could then be used at businesses were located..”

Sheriff’s deputies broke up a large identity theft operation this past weekend while investigating a report of drug dealing at a hotel room. Investigators contend the material found Sunday at Four Points by Sheraton at 11960 Foothill Blvd. was created using stolen information from card readers or skimmers, Rouse said.

The group allegedly started in Northern California and “have been working their way around,” he said.

On Sunday, a hotel manager called the Sheriff’s Department to report someone was selling drugs in one of the rooms.

Deputies discovered various items indicating Jeffery Wilkinson, 35, Barbara Brown, 32, and Shahin Abdollahi, 46, were involved in a large-scale identity theft ring, sheriff’s Sgt. Ken Jamieson said.

Wilkinson had an arrest warrant and was in the possession of drugs.

For more:  http://www.contracostatimes.com/california/ci_20355205/rancho-cucamonga-id-theft-ring-uncovered

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by | · 1:36 am

Hospitality Industry Crime Risks: "Large Identity Theft Operation" Uncovered At California Hotel After Manager Suspected Drug Sales

“…Deputies found fake credit and identification cards as well as computers, printers and software used to make false identification..Deputies also found credit card readers and small cameras that allowed criminals to capture credit card information and PIN numbers. Prepaid credit cards embossed with stolen information which could then be used at businesses were located..”

Sheriff’s deputies broke up a large identity theft operation this past weekend while investigating a report of drug dealing at a hotel room. Investigators contend the material found Sunday at Four Points by Sheraton at 11960 Foothill Blvd. was created using stolen information from card readers or skimmers, Rouse said.

The group allegedly started in Northern California and “have been working their way around,” he said.

On Sunday, a hotel manager called the Sheriff’s Department to report someone was selling drugs in one of the rooms.

Deputies discovered various items indicating Jeffery Wilkinson, 35, Barbara Brown, 32, and Shahin Abdollahi, 46, were involved in a large-scale identity theft ring, sheriff’s Sgt. Ken Jamieson said.

Wilkinson had an arrest warrant and was in the possession of drugs.

For more:  http://www.contracostatimes.com/california/ci_20355205/rancho-cucamonga-id-theft-ring-uncovered

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by | April 9, 2012 · 6:50 am

Hospitality Industry Legal Risks: Sen. Feinstein Pressures California Senate To Adopt Legislation To Curb "Abusive ADA Lawsuits" Against Small Businesses For Minor Violations Of "Disabled-Access Laws"

“…in Redlands, 22 businesses were sued by the same attorney for allegedly failing to post a sign next to the handicapped parking spaces that informed parking violators they would be towed. The business owners settled the cases in amounts ranging from $5,000 to $14,000, Feinstein wrote…”

The bill would require those seeking disabled access to first notify the business of a violation, and then give it 120 days to correct the problem, during which time the firm could not be sued.

Sen. Dianne Feinstein (D-Calif.) has written to the leader of the California Senate, calling for the state to adopt legislation that would curb what she calls abusive lawsuits filed by private attorneys against small businesses for minor violations of disabled-access laws, and warning that if the state doesn’t act, she will.

Feinstein said some attorneys are filing “abusive lawsuits,” and “coercive demand letters” to force small businesses to pay thousands of dollars over often-minor noncompliance with the federal Americans With Disabilities Act and the state Unruh Civil Rights Act.

Steinberg wrote back that the California Legislature shares her concerns and approved a measure in 2008 that helps businesses come into compliance and makes it tougher to sue. The state leader disputed Feinstein’s contention that SB 1186 by state Sen. Bob Dutton (R-Rancho Cucamonga) is a possible answer.

For more:  http://www.fox40.com/news/headlines/ktxl-sen-feinstein-calls-on-state-to-curb-abusive-lawsuits-over-ada-20120404,0,7811356.story

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by | · 6:50 am

Hospitality Industry Legal Risks: Sen. Feinstein Pressures California Senate To Adopt Legislation To Curb "Abusive ADA Lawsuits" Against Small Businesses For Minor Violations Of "Disabled-Access Laws"

“…in Redlands, 22 businesses were sued by the same attorney for allegedly failing to post a sign next to the handicapped parking spaces that informed parking violators they would be towed. The business owners settled the cases in amounts ranging from $5,000 to $14,000, Feinstein wrote…”

The bill would require those seeking disabled access to first notify the business of a violation, and then give it 120 days to correct the problem, during which time the firm could not be sued.

Sen. Dianne Feinstein (D-Calif.) has written to the leader of the California Senate, calling for the state to adopt legislation that would curb what she calls abusive lawsuits filed by private attorneys against small businesses for minor violations of disabled-access laws, and warning that if the state doesn’t act, she will.

Feinstein said some attorneys are filing “abusive lawsuits,” and “coercive demand letters” to force small businesses to pay thousands of dollars over often-minor noncompliance with the federal Americans With Disabilities Act and the state Unruh Civil Rights Act.

Steinberg wrote back that the California Legislature shares her concerns and approved a measure in 2008 that helps businesses come into compliance and makes it tougher to sue. The state leader disputed Feinstein’s contention that SB 1186 by state Sen. Bob Dutton (R-Rancho Cucamonga) is a possible answer.

For more:  http://www.fox40.com/news/headlines/ktxl-sen-feinstein-calls-on-state-to-curb-abusive-lawsuits-over-ada-20120404,0,7811356.story

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by | April 8, 2012 · 7:02 am

Hospitality Industry Theft Risks: Florida Hotel Employee Charged With Stealing $500 Of "Dom Perignon Champagne"; Picture Posting On "Facebook" Leads To Arrest

“…an employee at the hotel discovered pictures on a Facebook page of a former night auditor and a friend holding Dom Perignon champagne bottles with the caption: “Hey, we’re having Dom in the morning!”

The security cameras had been turned off at the time of the theft, according to a subsequent investigation.

A Panama City Beach hotel reported the theft of $500 of Dom Perignon champagne in February after an inventory of supplies showed three bottles were missing, according to a news release from the Bay County Sheriff’s Office.

The hotel manager ID’d the man as Jonathon Appleby, a former night auditor at the hotel. Appleby had access to the cooler with the champagne and to the security cameras while he was employed an investigation determined.

For more:  http://www.sun-sentinel.com/news/strange/sfl-champagne-20120408,0,4727820.story

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