In a move that could weaken the San Francisco tourism industry during a dour economy, hotel workers will vote today whether to authorize a strike after labor negotiations have dragged for two months.
Tourism — and specifically a 14 percent tax on each hotel room — is one of the largest tax generators for The City, raking in $528 million to the coffers last year. A strike could cause the loss of millions.
When hotel workers went on strike and were subsequently locked out in 2004, hotels lost between $50 million and $100 million in business, lowering the amount San Francisco collected in taxes for each room.
The 9,000 hotel workers — including room cleaners, bellhops and food-service workers — represented by Unite Here! Local 2 will vote today to authorize a strike, though that does not mean there will be an immediate work stoppage at the 61 hotels involved in the labor talks.
The vote, if approved, would give the 125-member union bargaining committee a green light to call a strike if negotiations hit a dead end.
The union has been negotiating with San Francisco’s major four chains — Hyatt, Hilton, Starwood and Intercontinental — since the contract expired Aug. 14.
“The last time we did this we went out on strike,” said Riddhi Mehta, spokeswoman for Unite Here! Local 2. “This is not an empty vote.”
At issue in the current negotiations are health benefits, wages and the length of the contract.
Union officials say all four major hotel chains have proposed to limit the contributions for health care that would eventually lead to increased co-pays and reduced benefits. In addition, the union says at least one chain has proposed cutting the starting pay for several positions by 25 percent.
Each hotel is attempting to negotiate a long-term contract that locks in the provisions from three to five years. Union officials, who expect the economy to rebound, have proposed a one-year contract. Representatives from Hilton, Hyatt and Starwood did not return calls for comment.
San Francisco Mayor Gavin Newsom, who walked the picket line with hotel workers in 2004 before intervening to end the strike and lockout, said he wasn’t worried about a potential walk-out.
“I’ve had a lot of meetings and I’m confident we are going to come together,” Newsom said. “I think at the end of the day both sides understand the consequences of going back to where we were a few years ago.”
Along with the tax dollars generated by hotels that could be lost during a potential strike, there are the other jobs that are created with tourism, including restaurants and taxicab drivers. During the previous strike and lockout, unions lobbied conventions and businesses to cancel their San Francisco events.
As the No. 1 industry in The City, tourism supported 72,856 local jobs in 2008 alone, according to the San Francisco Convention and Visitors Bureau. Approximately 16.4 million visitors spent $8.52 billion in The City last year.
Hotels in The City create thousands of jobs, as well as bring in tax money to fill The City’s coffers.
16.4 million Visitors to S.F. in 2008
$8.52 billion Visitor spending in S.F. in 2008
$528 million Tax revenues from visitor spending in 2008
72,856 Local jobs supported by visitor spending in 2008
9,000 Hotel union members
61 Hotels that would be affected by a strike
72.6% Average occupancy rate for S.F. hotels in 2009
79.2% Average occupancy rate for S.F. hotels in 2008
$158.08 Average daily rate for hotels in 2009
$190.28 Average daily rate for hotels in 2008
Source: San Francisco Convention and Visitors Bureau, Unite Here! Local 2
Unite Here! Local 2, the union representing 9,000 hotel workers and 61 hotel chains in The City, has been unsuccessful in contract talks for the past two months. There are several points the union says are still issues.
Length of contract
The union has proposed a one-year contract, while hotels have proposed contracts ranging from three to five years. Union members are demanding continued affordable health care, improvements to their dental care, retirement benefits, organizing rights, fair wage increases and reasonable workload guarantees in exchange for a multiyear contract.
All four chains have reportedly proposed limits to employer health care contributions, which union members say would lead to reduced benefits and inflated co-pays.
Hyatt, Hilton and Starwood all proposed to combine job classifications or create four-hour shifts, which union members say would leave fewer people to do more work.
Hilton has reportedly proposed cutting the starting rate of workers by 25 percent. Workers say this would take a newly hired housekeeper’s salary from $31,000 to $23,000 a year.
Source: Unite Here! Local 2