With Events in 21 Cities, UNITE HERE Calls to Close Hotel Owners’ Tax Loophole, End Job Cuts

Washington, D.C.— Hotel workers across the U.S. organized a National Day of Action on Thursday to shine a light on the “shadow boss” hotel owners they say are driving cuts to jobs and services in the hospitality industry. Hospitality workers’ union UNITE HERE is calling on major hotel owners called REITs (Real Estate Investment Trusts) to stop pushing for job cuts and is asking leaders in DC to close the tax loophole that enables REITs to avoid paying taxes on billions paid to investors.

Hotel housekeepers, bellmen, cooks, dishwashers, servers, bartenders, and more will rally and leaflet in front of federal buildings from Hawaii to DC, holding signs that rename hotel REITs as the hotel industry’s “Real Estate Income Tax Scandal.” Eighteen publicly traded hotel REITs paid $3.4 billion in dividends in 2019. REITs do not pay corporate income taxes on these billions because they claim not to operate or manage the hotels they own. But earnings calls reveal the role that REIT executives play in the operations of hotels they own.

In November of 2021, Park Hotels – the Hilton hotels REIT – listed operating priorities for a “permanent reduction of full-time, hotel-level staffing” including “contactless check-in/room service,” “limit housekeeping,” and “eliminate or re-purpose unprofitable F&B operations.” “We do think that given the crisis, and you don’t want to let any crisis go to waste, we have been working hard and working with our operating partners and also talking with the union about opportunities to rightsize that [operating] model,” said Thomas Baltimore, the CEO of Park Hotels, in a 4th quarter 2020 earnings call. That same year, as hotel workers faced unemployment and cuts to their jobs, Park tripled Baltimore’s pay.

“When these companies cut costs, it means they are cutting jobs and conditioning the guests to expect less,” said Sebastian Morales, a doorperson at the Hilton Boston Logan Airport in Boston, MA. “At the Hilton Logan, they have removed overnight room service and the buffet. What the owners don’t understand is that human workers are their most valuable asset. I’ve had so many guests say that they can stay at any hotel, but the reason they come back here is because of employees. We are the ones who take care of the guests and make their stay a good experience.”

“We’re at a moment of crisis in the hospitality industry, and even as the hotel industry recovers from COVID-19 shutdowns, service cuts driven by large hotel REITs threaten to eliminate living wage housekeeping jobs primarily held by women of color,” said UNITE HERE President D. Taylor. “We’re not going to let hotel REITs continue to be these faceless entities behind decisions that threaten to ruin the world-class experience our members offer guests during hotel stays.”

A key issue is the elimination of daily housekeeping and sanitation as an industry standard, which UNITE HERE estimates would cut up to 180,000 U.S. housekeeping jobs primarily held by women of color. Read our report, “Playing Dirty,” to learn more.

“Even with high occupancy, there’s no automatic daily room cleaning and we are understaffed,” said Ruby Rubina, a housekeeper at the Hilton Hawaiian Village in Honolulu, HI. “There are nights when we could not clean all the dirty vacant rooms, we had no choice but to leave some for the workers to clean the next morning. The overworked housekeepers are unable keep up. These changes hurt all of us. Park Hotels & Resorts owns over 70% of the guest rooms at Hilton Hawaiian Village—it’s one of their highest-earning properties. Yet, they are letting workers suffer while hundreds are still waiting to have their jobs back.”

Additionally, UNITE HERE is urging the Securities and Exchange Commission (SEC) to require that hotel REITs disclose to investors key workforce metrics about workers in the hotels that they own.