Fullscreen

AH February 2024

Welcome to interactive presentation, created with Publuu. Enjoy the reading!

News

News

www.asianhospitality.com

99

FEBRUARY 2024 ASIAN HOSPITALITY

he U.S. Department of Labor’s

definition of who qualifies as

independent contractors, due to

take effect in March, is meant to ensure

that workers are treated fairly, according

to the department. However, the

American Hotel & Lodging Association

says the new rule limits independent

contractors to work and impact hotels’

ability to find workers.

The new rule under the Fair

Labor Standards Act aims to prevent

misclassification of workers that can

affect workers’ rights to minimum wage

and overtime pay, “facilitates wage theft,

allows some employers to undercut their

law-abiding competition and hurts the

economy at-large,” the Labor Department

said in a statement. It uses a multifactor

analysis of six factors defining a worker’s

relationship with an employer, such as

the worker’s opportunities for profit or

loss; the financial stake and nature of any

resources a worker has invested in the

work; the degree of permanence of the

work relationship; the degree of control

an employer has over the individual’s

work; how essential the work is to the

employer’s business; and the worker’s

skill and initiative.

“Misclassifying employees as

independent contractors is a serious

issue that deprives workers of basic

rights and protections,” said Julie Su,

acting secretary of labor. “This rule will

help protect workers, especially those

facing the greatest risk of exploitation, by

making sure they are classified properly

and that they receive the wages they’ve

earned.”

However, AHLA said in its statement

that the new rule, which rescinds the 2021

Independent Contractor Rule, will limit

some individuals’ opportunities to work

as independent contractors and hurt

hotels’ ability to maintain operations.

“We are extraordinarily disappointed

that the Labor Department dismissed

the concerns of the thousands of small

business owners AHLA represents and is

insisting on making it harder for hotels

to maintain operations in what is already

one of the toughest labor markets in

recent history,” said Chip Rogers, AHLA

president and CEO. “In the face of a

nationwide shortage of workers, hoteliers

need maximum flexibility to hire

independent contractors, and contractors

often prefer the flexibility of being

classified this way. Despite this reality,

the Labor Department is focused on

making it harder, not easier, for hoteliers

to hire the workers they need.”

Rogers also said AHLA is reviewing

legal options to challenge the new

regulation. Its other arguments against

the new regulation center around

complications that it presents to the

worker classification process.

“The regulation invites confusion

and litigation by establishing a test

where any of six different factors

could be determinative of employee

status, as opposed to DOL’s prior

regulation, under which two core factors

guided classification determinations.

Additionally, the regulation introduces

a vague mandate forcing businesses to

consider the ‘economic realities’ of the

relationship between a worker and a

company as well as an undefined set

of ‘additional factors’ that must also be

considered,” AHLA said in its statement.

“The regulation will increase liability

for businesses and reduce opportunities

for those interested in working as

independent contractors, a status many

workers prefer because it gives them

more flexibility and autonomy over their

work. This will make it more costly

and time consuming for hoteliers to

hire the independent contractors they

need, harming the industry’s ability

to maintain operations and reducing

business opportunities for independent

contractors.”

AHLA opposes new DOL rule

defining independent contractors

The department claims the change ensures fairness, AHLA says it will limit hotels’ operations

The American Hotel & Lodging Association says the U.S. Department of Labor’s new rule for defining

whether a worker is an independent contractor or a regular employee complicates the process, will

limit opportunities for workers and impact hotels’ ability to find workers.

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32