Los Angeles Business Journal

Workers at Two LAX Hotels to Receive Service Tips

By Deborah Crowe Originally published April 3, 2013 at 3:34 p.m., updated April 3, 2013 at 5:10 p.m.

Two hotels near Los Angeles International Airport are expected this month to pay $4.5 million to settle two class-action lawsuits alleging that the hotels pocketed service charges instead of passing them on to room service, bell and banquet employees.

About 252 workers at the Marriott Hotel at LAX and Renaissance Hotel are expected to receive settlement checks in early April, according to a Wednesday announcement by the workers’ union, Unite Here Local 11.

Hotel representatives could not be immediately reached for comment.

The union filed suit against the hotels in 2007 over alleged violations of the Los Angeles Hotel Service Charge Reform Ordinance, which requires hotel operators to pass along tips received at banquets to the servers and others working those events. The ordinance was one of a trio of laws that the City Council passed in 2006 aimed at raising pay and benefits for workers at 13 hotels near LAX.

“When banquet clients see a 20-percent ‘service’ on their bills, most people assume it’s a tip for service workers,” Ada Briceno, the union’s secretary-treasurer, said in a statement. “Instead, the employers were pocketing that charge for extra profit. This ordinance is about fairness for workers and transparency for guests.”

Staff reporter Howard Fine contributed to this story.