Hospitality Staffing Solutions

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Hospitality Staffing Solutions (HSS) is privately-owned company that provides staffing and outsourcing for the hospitality industry, particularly for hotels and resorts. Based in Atlanta, Georgia, the company was founded in 1990. As of August 2014, it was owned by Kathryne King and its CEO and President was Rick M. Holliday.[1] HSS has offices in 36 states.[2]

As a privately held company, HSS does not make public detailed information about its business operations. According to a 2014 Experian Business Report, annual sales in the most recent fiscal year were $896,000,000.[3] HSS had approximately 4,000 employees in 2008.[4] When it filed for bankruptcy in fall 2013, the company listed its assets at between $10 million and $50 million.[5]

On its website, HSS describes its business model as follows:

"Our model offers clients the continuity of full time employees with the scalability of flexible staffing. The same trained associates show up to work at their assigned hotels each day, but the number of our staff flexes with the rise and fall of seasonality and occupancy."[6]

In other words, workers may work at the same hotel for years, but are classified as temp employees at HSS, not as employed by the hotels themselves. Hotels and other businesses have increasingly turned to outsourced labor not only to save on costs like health care and other benefits, but also for 'flexibility,' according to American Hotel and Lodging Association president Joseph McInerney told Huffington Post. "Saving money is the last part of this," McInerney said. "It's about the ability to have the employees when you need them."[7]

In response to complaints about HSS's treatment of workers after its 2009 takeover of staffing at Boston-area Hyatt hotels, HSS CEO Rick Holliday told the Boston Globe, "You don’t run a business for 18 years and have the amount of employees that we have in the cities we have and not make a mistake."[8]

Controversies

HSS Workers at Santa Monica DoubleTree File Wage and Hour Claims, 2014

In April 2014 workers at a DoubleTree Suites by Hilton Hotel in Santa Monica filed complaints with the California Department of Industrial Relations, alleging that they were not paid overtime or given legally required meal breaks. State law entitles workers to one hour of back pay for each missed break. According to the Orange County Register, "Maria Zamora, who filed a claim, said she marked her overtime in a log and returned the next day to find it erased."[9]

"We don't even have 10 minutes for rest, like the law requires," Farid Chevez, a houseman, said. "I've only worked there a year. There are people that have been there much longer - 10, 11, 12 years."[9]

Zamora said that workers employed through HSS make much less than other workers, reporting that some who have worked at the hotel for a decade make as little as $8.50 per hour.[9]

Acquisition, Bankruptcy, and Sale, 2010-2014

In 2010, HSS was acquired by Frontenac Co., a private equity firm, for $80 million. Three years later, it filed for Chapter 11 bankruptcy protection. According to Reuters, HSS had around $60 million in debt and was having problems with "employee verification and other operational issues."[10] In October 2013, HSS announced a plan to sell its assets to HS Solutions Corporation, a new entity created by a group of private investors that would become the new owner of HSS.[11] CEO Rick Holliday said in a statement about the deal, "This transaction will allow us to clean up our balance sheet and emerge as a stronger company with new owners."[12] The sale was completed in January 2014, and HSS emerged from bankruptcy at that time.[13]

Alleged Hiring Blacklist Prompts Push for New Law in Indianapolis, 2012

In 2012, hotel workers and advocacy groups including UniteHere! began pushing for an end to contracts between hotels and staffing agencies, including HSS, that allegedly prevented "temp" workers from seeking direct employment with hotels. As WTHR Indianapolis described the practice, "if a full-time position opens up, the contract worker cannot apply for that job for a year after they've quit, not just at that hotel, but any hotel that the subcontractor has an agreement with."[14] WXIN Indianapolis reported,

Martha Hernandez worked at a Hyatt hotel and the JW Marriott with a temporary work agency, Hospitality Staffing Solutions. She said she wasn't given any benefits like holidays, days off or insurance and decided she would like to get a job through a hotel, instead of continuing to work as a temporary worker.
"When I went to find a better job at a hotel, I found I was not allowed to be hired."[15]

The practice gives a new meaning to one of HSS's stated Core Values, "Relentlessly pursue the best people."[16]

The so-called "Freedom to Work" proposal would have said that "as a condition of getting and maintaining their annual license, hotels cannot 'be a party to any agreement that prevents (them) from hiring employees of any contracting serve at the hotel,'" according to WTHR.[14]

The proposal was passed 16-9 by the Indianapolis City Council in July 2012, but was vetoed by Mayor Greg Ballard, who called it an "overreaching and overly burdensome city regulation on business."[17]

Indianapolis Workers' Suit Results in Settlement and HSS Losing Hotel Contracts, 2012

In January 2012, sixteen workers at hotels in Indianapolis filed a lawsuit against their employer, Hospitality Staffing Solutions, alleging that "they were forced to work off the clock and through their unpaid breaks, sometimes pushing their earnings below the minimum wage of $7.25 per hour," and that hotel management was aware of the situation.[18] According to the Indianapolis Star,

"One worker, Consuelo Guzman, 34, said Hospitality Staffing regularly paid her for fewer hours than she worked cleaning rooms.
"There were just way too many rooms that were way too dirty in my shift," she said. So to get all the rooms cleaned, she didn't take lunch breaks or worked past the end of her shift, she said.
She estimates she is owed $5,200 for unpaid work over the past two years."[19]

The complaint also named Marriott, the Canterbury Hotel, the Conrad Indianapolis, Embassy Suites Downtown, Holiday Inn Select Indianapolis Airport, Hyatt Regency Indianapolis, Hyatt Place Indianapolis Airport, Indianapolis Marriott Downtown and the Omni Severin.[19]

The suit was settled in December 2012 for an undisclosed amount, with some workers telling Huffington Post that conditions have improved as a result of the suit.

In a statement, Hospitality Staffing Solutions said that "While these employees’ claims could not be verified, the Company has resolved their claims in good faith and in order to avoid the expense and distraction of litigation."[20] But according to Unite Here, an organization that represents hotel workers, "Multiple area hotels severed ties with HSS, including the Hyatt Regency Indianapolis, Marriott, the JW Marriott and the Conrad" as a result of the lawsuit.[21]

HSS and Global Hyatt Settle Pittsburgh Wage and Hour Lawsuit, 2010

Housekeeping and janitorial staff at two Pittsburgh-area Hyatt hotels filed a lawsuit against HSS and Hyatt in 2009, claiming that they had been not been paid for all hours worked and that they had not been paid overtime. The case was settled for an undisclosed amount in 2010.[22]

Boston-Area Hyatts Boycotted after Outsourcing to HSS; Hyatt Pays $1M Settlement

Hyatt Hotels Corp. fired nearly 100 housekeepers in 2009, offering to let them return to their jobs at a lower wage through HSS. Workers like housekeeper Lucine Williams, who had worked at Hyatt for 22 years, had received dental, health, and a 401(k) and could earn upwards of $15 an hour.[23] HSS offered pay of around $8/hour and no benefits.[8]

The move prompted public outrage and threats of a boycott, according to the Boston Globe. At the time, HSS was the subject of 6 pending wage and hour complaints in Massachusetts, including one filed by a housekeeper whose workload increased by over 40% after the mass layoffs, with no extra pay. Several months later, she was fired on the spot when she could not complete her work due to increasing back pain.[8]

In September 2014, Hyatt agreed to a $1 million settlement in return for an end to the boycott, which had cost the company an estimated $6 million over five years. According to the Boston Globe, "Under the settlement, these workers also will receive preference in hiring at future Boston-area Hyatt hotels, although many said they would be reluctant to return to a Hyatt unless it is unionized."[24]

Personnel

CEO

Rick M. Holliday has served as HSS CEO since 2007. He previously worked for Sheraton Hotels/Starwood and a number of resorts, and has served as President of the Mississippi Hotel and Lodging Association.[25]

Holliday has made contradictory statements to the press regarding his knowledge of wage and labor issues among HSS workers. For example, when asked about the Indianapolis workers' complaints in August 2011 he told the Huffington Post "that any instances of wages not being paid were honest mistakes, and that he would personally look into any such allegations."[26] But in January 2012 WTHR-Indianapolis reported, "Hospitality Staffing Solutions CEO Rick Holliday, interviewed by phone, said this was the first he'd heard of any problems employees had with pay and that they have a system in place for complaints."

In September 2009, as HSS was under scrutiny after the firing of nearly 100 Boston-area Hyatt workers, Holliday told the Boston Globe, "You don’t run a business for 18 years and have the amount of employees that we have in the cities we have and not make a mistake."[8]

Senior Staff

As of September 2014:[3][2]

  • Rick M. Holliday, CEO
  • William (Bill) E. Carpenter, COO/CFO
  • Mauricio Ramirez, Executive Vice President, South
  • David Bell, CRO, CCO, Senior Vice President of Human Resources
  • Steven Dougherty, Vice President, Managed Services
  • Naveen Ahuja, Vice President, Sales
  • Martin Mazy, VPO, West
  • Randy Oloffson, VPO, North
  • Karla Dougherty, VPO, Central
  • Luke Lindahl, Vice President, Finance
  • Paul Herrera, DOR, Janitorial
  • Curtes Cortest, Corporate Controller
  • Gerald V. Gurbacki, President
  • Kappy A. King, Chairman

Contact

Address: 100 Glenridge Point Pkwy Ste 4
Atlanta, GA 30342-1443
Phone: 877-477-3866
Website: http://www.hssstaffing.com/

External Resources on Temp Labor

References

  1. Bloomberg Businessweek, Hospitality Staffing Solutions, LLC, corporate profile, accessed August 25, 2014.
  2. 2.0 2.1 Hospitality Staffing Solutions, LLC, Company, organizational website, accessed September 16, 2014.
  3. 3.0 3.1 Experian Information Solutions, Inc., HOSPITALITY STAFFING SOLUTIONS, LLC, Experian Powered Business Reports, September 8, 2014. Accessed September 16, 2014 via Lexis Nexis.
  4. District Judge William S. Duffey, Jr., Echo Lentz v. Hospitality Staffing Solutions, 1:06-cv-1893-WSD, U. S. District Court for the Northern District of Georgia, Atlanta Division, Decided January 28, 2008. Accessed via Lexis Nexis September 16, 2014.
  5. Bankruptcy filing, HSS Holding LLC, The Deal Pipeline, October 24, 2013. Accessed via Lexis Nexis September 16, 2014.
  6. Hospitality Staffing Solutions, "Company," organizational website, accessed August 25, 2014.
  7. Dave Jamieson, "As Hotels Outsource Jobs, Workers Lose Hold On Living Wage," Huffington Post, August 24, 2011. Accessed August 25, 2014.
  8. 8.0 8.1 8.2 8.3 Katie Johnston Chase, "Hotel staffing company faced wage complaints," Boston Globe, September 26, 2009. Accessed August 25, 2014.
  9. 9.0 9.1 9.2 Joanna Clay, "DoubleTree workers file claims with state," Orange County Register, April 11, 2014. Accessed via Lexis Nexis September 16, 2014.
  10. Tom Hals, "U.S. hotel staffing company files for bankruptcy, seeks sale," Reuters, October 24, 2013. Accessed August 25, 2014.
  11. "[http://www.reuters.com/article/2013/10/24/ga-hospitality-staffing-idUSnBw246353a+100+BSW20131024 Hospitality Staffing Solutions, LLC Announces Proposed Sale and Asset Purchase Agreement with Private Investment Firm]," press release, republished by Reuters, October 24, 2013. Accessed August 25, 2014.
  12. Bevin Fletcher, "HSS plans $23M sale in Chapter 11," The Deal Pipeline, October 25, 2013. Accessed via Lexis Nexis September 16, 2014.
  13. "Hospitality Staffing Solutions, LLC Completes Asset Sale to Private Investment Firm," press release, PR Newswire, January 27, 2014. Accessed August 25, 2014.
  14. 14.0 14.1 Mary Milz, "Indianapolis considers 'freedom to work' proposal," WTHR Indianapolis, May 14, 2012. Accessed September 16, 2014.
  15. Eva Pilgrim, "Proposal seeks to help temporary hospitality employees find permanent jobs," WXIN-TV Indianapolis, May 15, 2012. Accessed via Lexis Nexis September 16, 2014.
  16. Hospitality Staffing Solutions, "Core Values," organizational website, accessed September 16, 2014.
  17. "Mayor vetoes hotel-worker blacklisting proposal," Indianapolis Business Journal, July 19, 2012. Accessed September 16, 2014.
  18. Dave Jamieson, "Hotel Workers Stiffed Millions In Wages, Lawsuit Alleges," Huffington Post, January 9, 2012. Accessed August 25, 2014.
  19. 19.0 19.1 Jeff Swiatek, "10 hotels named in OT lawsuit," The Indianapolis Star, January 9, 2012. Accessed via Lexis Nexis September 16, 2014.
  20. Dave Jamieson, "Indianapolis Hotel Workers Settle Lawsuit Over Wage Theft Allegations," Huffington Post, December 12, 2012. Accessed August 25, 2014.
  21. "Historic lawsuit settled for hotel workers," Unite Here/Hyatt Hurts, press release, December 12, 2012. Accessed September 17, 2014.
  22. Julie Zeveloff, "Pittsburgh Hyatts Settle Housekeeping OT Class Action," Law360, April 9, 2010. Accessed August 25, 2014.
  23. Katie Johnston Chase, "A hard ending for housekeepers," Boston Globe, September 17, 2009. Accessed August 25, 2014.
  24. Katie Johnston, "Hyatt to pay ousted workers $1m in boycott-ending deal," Boston Globe, September 26, 2014. Accessed November 4, 2014.
  25. Hospitality Staffing Solutions, Rick M. Holliday, organizational profile, accessed September 16, 2014.
  26. Dave Jamieson, "As Hotels Outsource Jobs, Workers Lose Hold On Living Wage," Huffington Post, August 24, 2011. Accessed September 16, 2014.