Skip to content

Search

Latest Stories

AHLA opposes new DOL rule defining independent contractors

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

AHLA opposes new DOL rule defining independent contractors

THE 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.”

In November, former AAHOA Chairwoman Jagruti Panwala testified before Congress on behalf of AHLA regarding the Labor Department’s proposal to raise the overtime salary exemption threshold for executive, administrative, and professional employees under the Fair Labor Standards Act. Panwala, now a board member for AHLA, argued that the proposed change would actually limit hotel employees’ opportunities and does not take into account economic differences between regions of the country.

More for you

Howard Johnson 100th anniversary

HoJo marks centennial with throwback

Summary:

  • Howard Johnson is marking its 100th anniversary with fried clam–shaped soaps.
  • The soaps pay homage to an iconic HoJo menu item.
  • Available at select hotels and for online purchase starting Oct. 3.

HOWARD JOHNSON BY Wyndham marks a century with one of its most famous menu items, the fried clam strip. The brand is introducing limited-edition HoJo’s Original Fried Clam Soap, available at select Howard Johnson hotels across the U.S. and for online purchase beginning Oct. 3.

Keep ReadingShow less
American Franchise Act announced in U.S. Congress to protect hotel franchising and jobs

House unveils act to boost franchise business

Summary:

  • House introduces AFA to boost franchise model and hotel operations.
  • The act establishes a joint employer standard.
  • AHLA backs the bill, urging swift adoption.

THE HOUSE Of Representatives introduced the American Franchise Act, aimed at supporting the U.S. franchising sector, including 36,000 franchised hotels and 3 million workers nationwide. The American Hotel & Lodging Association, backed the bill, urging swift adoption to boost the franchise model and clarify joint employer standards.

Keep ReadingShow less
Noble Investment Group Mobile Alabama

Noble breaks ground on StudioRes in Mobile, AL

Summary:

  • Noble broke ground on StudioRes Mobile Alabama at McGowin Park.
  • The 10th StudioRes expands Noble’s long-term accommodations platform.
  • Noble recently acquired 16 WoodSpring Suites properties through two portfolio transactions.

NOBLE INVESTMENT GROUP broke ground on StudioRes Mobile Alabama at McGowin Park, a retail center in Mobile, Alabama. It is Noble’s 10th property under Marriott International’s extended stay StudioRes brand.

Keep ReadingShow less
The Boxer Boston hotel sold by Hersha Hotels to Eurostars Hotels for $23.6 million
Photo Credit: The Boxer Boston

Hersha sells ‘Boxer Boston’ to Eurostars

Summary:

  • Hersha Hotels & Resorts sold The Boxer Boston to Eurostars Hotels.
  • The company acquired the property in 2012 for $12.6 million.
  • The property now sold for $23.6 million.

HERSHA HOTELS & RESORTS sold The Boxer Boston, an 80-room hotel in Boston’s West End, to Eurostars Hotels, part of Spain’s Grupo Hotusa. The company, which reportedly acquired the property in 2012 for $12.6 million, received $23.6 million for it.

Keep ReadingShow less
Peachtree Group Inc. 5000 2025

Peachtree receives two recognitions

Summary:

  • Peachtree recognized by Inc. and the Atlanta Business Chronicle.
  • Named to the 2025 Inc. 5000 list for the third year.
  • Chronicle’s Pacesetter Awards recognize metro Atlanta’s fastest-growing companies.

PEACHTREE GROUP ENTERED the 2025 Inc. 5000 list for the third consecutive year. The company also won the Atlanta Business Chronicle Pacesetter Awards as one of the city’s fastest-growing private companies.

Keep ReadingShow less