Case Study: Improving Performance at the Hotel Paris$$The Hotel Paris$$s New Labor Relations Practices

The Hotel Paris$$s competitive strategy is $$To use superior guest service to differentiate the Hotel Partis properties, and to thereby increase the length of stay and return rate of guests, and thus boost revenues and profitability.$$ HR Manager Lisa Cruz must now formulate functional policies and activities that support this competitive strategy and boost performance by eliciting the required employee behaviors and competencies.

Lisa Cruz$$s parents were union members, and she had no strong philosophical objection to unions, per se$.$ However, as the head of HR for the Hotel Paris, she did feel strongly that her employer should do everything legally possible to remain union$-$free. She knew that this is what the hotel chain$$s owners and top executives wanted and that achieving their strategic goals would be best accomplished by staying union$-$free. Furthermore, the evidence seemed to support their position. At least one study that she had seen concluded that firms with $30\%$ or more of their eligible workers in unions were in the bottom $10\%$ in terms of performance, while those with $8\%$ to $9\%$ of eligible workers in unions scored in the top $10\%.$ The problems were that Hotel Paris had really had no specific policies and procedures in place to help its managers and supervisors deal with union activities. With all the laws regarding what employers and their managers could and could not do to respond to a union$$s efforts, Lisa knew her company was a $$problem waiting to happen.$$ She turned her attention to deciding what steps she and her team should take with regard to labor relations and collective bargaining.

Lisa and the CFO knew that unionization was a growing reality for the Hotel Paris. Some of the hotel chains in the United States had employees that were already unionized, and unions in this industry were quite active. For example, as they were surfing the internet to better gauge the situation, Lisa and the CFO came across the Web site from the Hotel Employees Restaurant Union, Local $26.$ It describes their success in negotiating a contract at several local hotels including ones managed by the Westin and Hilton chains. The CFO and Lisa agreed that it was important that she and her team develop and institute a new set of policies and practices that would enable the Hotel Paris to deal more effectively with unions.

Together with a labor$-$management attorney, the team developed a $20-$page $$What You Need to Know When the Union Calls$$ manual for Hotel Paris managers and supervisors. This contained three sets of information. First it provided a succinct outline of labor relations law, particularly as it related to the company$$s managers. Second, it laid out a detailed set of guidelines regarding what supervisors could and could not do with respect to union organizing activities. Third, it identified all line supervisors as the company$$s $$front$-$line eyes and ears$$ with respect to union organizing activity. Here, the manual provided examples of activities that might suggest that a union was trying to organize the hotel$$s employees, and whom the supervisor should notify.

Lisa and her team also decided to ensure that the company was responsive to its employees$$ concerns. Lisa, and her team believed that many of the steps they$$d taken earlier would help. For example, improving salaries and wages, providing financial incendivities, and instituting the new ethics, justice, and fairness programs already seemed to be having a measurable effect on employee morale.