Hotel Subcontractors Form Group To Join Fight Against Controversial Hotel Bill

As New York City hotel owners mobilize to try to kill a bill that would require them to use union labor to staff their properties, the subcontractors who would ostensibly be banned from working in the city's hospitality businesses are organizing to jump into the fray.

A group of nine companies and more than 5,000 hospitality workers who are subcontracted to hotels across the city have formed a new advocacy group called the Coalition for Hotel Subcontractors, Bisnow has learned. The group's public debut will be at a rally Thursday morning in front of City Hall in opposition to the Safe Hotels Act, otherwise known as Int. 991.

It was introduced by Council Member Julie Menin this summer to the surprise and outrage of the hotel industry, whose members stumbled upon the bill by accident, Bisnow reported last month. Menin's bill would mandate that hotel owners obtain a license that has to be renewed every two years and outlaw hotels' use of third-party contractors, except for security.

“It's going to cause a lot of chaos in the hospitality industry,” Camilo Torres, chief operating officer of Manhattan-based hospitality staffing solutions company Lumina HR, said in an interview Wednesday. “I can't even really think about what the hospitality industry is going to look like if this goes through.” 

The subcontractor coalition’s argument against the bill echoes hotel owners’ messaging: The city’s hotel industry can't function without subcontractors and will be far more expensive for customers if the Safe Hotels Act passes.

Hotel owners mobilized almost overnight to oppose the bill. Groups including Hotel Owners of New York and the American Hotel and Lodging Association formed a chorus condemning the proposal. Now, the Coalition for Hotel Subcontractors is the latest newly formed industry group to jump into the fray.

“From health insurance and bank accounts to job applications and social services, my business keeps my 600 employees, many of whom immigrated to New York City to find better lives, secure at a time when stable careers are few and far between,” Oksana Rudenko, director of operations at a Brooklyn-based hotel cleaning subcontractor, said in a prepared statement. “Intro 991 threatens to destroy everything we’ve worked so hard to build here.”

Torres said his company will have to lay off around 250 workers if the bill goes through. The idea that hotels will be able to hire them all directly isn’t realistic for the industry, he said.

“We recruit, we employ, we manage. Hotels have to worry about a million other things,” Torres said. “Now they're going to recruit and manage and onboard and do all the HR stuff that they normally don't do. It's going to create a bottleneck.”

Hiring hospitality staff has been hard for NYC hotels since the pandemic hit, KER Management Group owner and developer Nick Patel told Bisnow. Patel, who is part of the NYC Minority Hotel Association, owns and operates nine small hotels in the outer boroughs totaling around 640 keys.

KER Management opened the luxury 42 Hotel in Williamsburg in 2022, when he said he had the most difficulty getting staff in 25 years in NYC’s hospitality business.

“We had ads everywhere to get employees to come work for us,” he told Bisnow. “We couldn't open the hotel for almost two to three weeks because I was having a hard time finding people.”

Because the hotel industry, even in the country's biggest tourist market, is still seasonal, taking away subcontractors — who offer more flexibility than hiring staff — would undermine the majority of KER Management’s hotels’ ability to function, Patel said. KER Management sends out around 80% of its linen for servicing.

“We don't have the ability of having bedsheets and pillowcases ironed at our place. I mean, we can do towels. That's about what we do,” Patel said. “If we had to bring in in-house services like that, I’m not sure how we would go about doing that.”

Torres, Patel and various coalitions — including the NYC Minority Hotel Association, the National Association of Black Hotel Owners, Operators and Developers, and the Asian American Hotel Owners Association — are planning to attend the rally Thursday morning outside City Hall against the Safe Hotels Act.

Menin's office didn't immediately respond to Bisnow's request for comment. The industry is bracing itself for a mid-October hearing in the City Council, Besen Partners Hotel Advisory Group Senior Director Anudeep Gosal told Bisnow. The bill isn't on the agenda for the Sept. 25 meeting of the Committee on Consumer and Worker Protection, where Menin introduced the legislation.

Proponents of the bill — including one of the city’s most powerful labor unions, the Hotel and Gaming Trades Council, as well as the NYC Police Benevolent Association and Queens Borough President Donovan Richards — say the bill would help authorities crack down on human trafficking and unsafe conditions in the city's hotels.

But hotel owners and workers say it betrays a lack of understanding of how the industry works, they told Bisnow last month.

“Many, if not most, hotels in Queens, the Bronx and parts of Brooklyn will go out of business resulting in compression and raised prices for the remaining hotels,” said Vijay Dandapani, president of the Hotel Association of New York.