Home Hotel management Severance pay for displaced hotel workers in New York now available

Severance pay for displaced hotel workers in New York now available

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As of October 5, 2021, Int. 2397-2021 obliges operators of “transit hotels” (as defined by New York City Zoning Resolutions Section 12-10) to pay their employees severance pay if: (1) the hotel has closed to the public and has not, by October 11, 2021, recalled at least 25% of the number of employees it employed as of March 1 2020 and has not reopened to the public by November 1, 2021; or (2) the hotel suffered a mass layoff after March 1, 2020 which resulted in the loss of work of at least 75% of the employees within a period of 30 days. There is an exception for hotels that have closed permanently and are in the process of converting to another use, provided that: (1) hotel employees are offered severance pay of at least 20 days of salary per year of service; and (2) severance pay was specifically linked to conversion.

To be eligible for severance pay, an employee working in a walkway hotel must have: (a) been employed by the hotel on March 1, 2020 for at least one year; (b) has been employed to perform a “hotel service” (broadly defined to include any work performed in the course of operating a hotel); (c) not be a managerial, supervisory or trusted employee who had the power to exercise control over the management of the hotel; and (d) been laid off after March 1, 2020 due to a closure or mass layoff. Severance benefits are due to all such employees as of October 11, 2021, up to 30 weeks for an amount of $ 500 per week, or up to a total of $ 15,000. The obligation to pay severance pay ends when an employee is recalled or, for a closed hotel, when the hotel reopens to the public and recalls 25% of its employees. In particular, any severance pay paid to a hotel employee before October 11, 2021 does not constitute compensation for the obligations to pay severance pay to hotel employees after October 11, 2021; however, any severance pay paid after October 11 will serve as compensation for severance pay obligations under this Act. The law will expire and be deemed repealed on June 1, 2022.

© 2021 Proskauer Rose srl. Revue nationale de droit, volume XI, number 286


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