Thread: Hotelier Exploited Foreign Workers in New Orleans

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Hotelier Exploited
Foreign Workers
After Katrina, Suit Says

By MIRIAM JORDAN and EVAN PEREZ
August 17, 2006; Page B1

One of the toughest problems in the reconstruction of New Orleans has been finding enough workers to revive the city. Now a hotel company that found a legal way to bring in workers from Latin America has been hit with a lawsuit alleging that it has exploited them in violation of U.S. labor law.

The lawsuit filed yesterday in federal court in Louisiana against closely held Decatur Hotels and Chief Executive F. Patrick Quinn III touches on the hot-button issue of finding workers for the Gulf Coast region following last year's devastating Hurricane Katrina. That debate centers on whether companies are hiring foreign workers, mainly Latino migrants, because they are cheaper or because there is a dearth of U.S. residents available to take blue-collar jobs. Many illegal immigrants, mainly from Latin America, have been flocking to New Orleans to do cleanup work.

The lawsuit, which seeks class-action status, involves an unusual move by Decatur to recruit foreign workers under a government program, known as the H-2B guest-worker program. To qualify for the program, employers must prove to the government that they cannot find U.S. residents to fill the jobs in question. The program is designed to hire foreign workers to do temporary work in nonagricultural areas, often on a seasonal basis.

Several other companies in the region have also hired foreign workers under the guest-worker scheme after winning approval from the Labor Department, according to worker-rights organizations.

About 300 foreign workers are believed to have been hired early this year by Decatur to do housekeeping, maintenance and other work at its properties, according to officials at the National Immigration Law Center, a Washington-based advocacy group involved in the case.

In the lawsuit, 82 workers from Bolivia, Peru and the Dominican Republic allege that Decatur and Mr. Quinn violated the Fair Labor Standards Act by failing to reimburse them for fees paid to labor recruiters working as agents of the hotel chain abroad, as well as travel expenses and visa fees adding up to as much as $5,000. The lawsuit says Decatur should have made those payments in their first week of work to comply with labor law. The lawsuit further states that the company exploited the workers' indebtedness and lack of familiarity with U.S. laws to violate their legal rights.

Mr. Quinn said in a statement yesterday that Decatur "has provided many additional benefits outside the scope of the agreement. When questions surfaced last week, management offered to meet with the small group of workers who were expressing concerns. This offer was declined."

In another statement, Pat LeBlanc, an attorney for Decatur said that "we do know that most of the international workers who are with us are content and are not participating in this complaint."

The lawsuit also alleges that the workers' high level of personal debt stemming from their entry to the U.S. has left them in "virtual debt peonage," since they can neither make enough money to pay off their debt by working for the hotel chain nor, under the provisions of their visas, can they work for any other employer to earn additional money. The suit also states that "in recent weeks their predicament has been complicated ... by failure to offer them 40 hours of work each week."

Julia Magnani, a Bolivian who has been working at the Decatur chain's 515-room Astor Crowne Plaza in the historic French Quarter, said she sold her biggest asset, a taxi, to pay expenses associated with taking the job in the U.S. "I'm making the same or less than I earned in my country" depending on the week, said the 45-year-old single mother who earns $6.02 an hour and pays $200 a month for lodging.

"Now I'm stuck, because I don't have enough money to pay for a flight home." She said that she and other workers were recruited by a labor broker who enticed them with promises that they would earn at least $8 an hour, plus food and housing.

"The Department of Labor takes any allegation of violations of federal labor law very seriously," said a spokesman, adding that the agency has stepped up enforcement in the Gulf Coast region since the hurricane with the deployment of Spanish-speaking investigators. That has resulted in recovering nearly $1.5 million in back wages for workers, he said.

The suit comes against the backdrop of an ongoing labor shortage in New Orleans. Nearly a year after Hurricane Katrina, "help wanted" signs abound there and elsewhere in the Gulf Coast, as the region suffers from a chronic shortage of workers. From restaurant work to construction and more skilled jobs, businesses are having a hard time filling positions. The problem of attracting workers to rebuilding efforts is made more complicated by the severe housing shortage, which has kept many residents from moving back. That in turn has slowed some of the rebuilding.

In New Orleans, immigrants are packed into tiny apartments and temporary shelters, and contractors vie for their services in prominent locations, such as Lee Circle, under the statue of Robert E. Lee, near the office towers of downtown.

Local officials, from New Orleans Mayor Ray Nagin to Mississippi legislators, have vented frustration at the thousands of immigrant workers, many without legal work permits, who arrived in the region. However, the workers have performed much of the back-breaking cleanup work and filled some of the service jobs needed to help jump-start tourism in New Orleans and elsewhere along the coast. Mr. Nagin drew criticism when he expressed concern about the city being "overrun with Mexican" immigrants.

The lawsuit against Decatur and Mr. Quinn says that the employer asserted that it couldn't find laborers "despite the fact that local U.S. workers, mostly African Americans, had previously worked in this industry in New Orleans and were available to do so."

"If you paid these displaced people a living wage of $10 an hour and they could stay in the hotel and work there, a lot of these people would have taken the jobs," said Tracie Washington, a New Orleans civil-rights lawyer on the case. But, she added, "There is a real difference between hiring people in the community that will organize more easily and those who don't speak English and don't know the law of the United States."

A spokeswoman for Hilton Hotels Corp., which has two company-owned hotels in the city, said that 85% of their current employees are returning employees. She said they are paying higher salaries than before and offering quarterly retention bonuses.

Saket Soni, an organizer for the New Orleans Worker Justice Coalition, said that several other companies have used the guest-worker program to fill their labor needs. However, he declined to name them to protect the workers.

At a news conference in New Orleans, the plaintiffs displayed the "application for alien employment certification" that Decatur filed to the Labor Department on Oct. 6, 2005. The application states in a space provided for describing efforts to recruit U.S. workers and results that, among other things, Decatur "offered work to hurricane evacuees. No one applied."

Ms. Magnani, the Bolivian housekeeper, said that co-workers hired locally were earning $9 an hour to do the same work, and that this had created tensions.

In 2002, agricultural guest workers won a similar legal case in the 11th Circuit against two Florida companies on the grounds that they hadn't reimbursed workers for their travel, visa and other expenses incurred to reach the U.S.

Founded in 1988 by Mr. Quinn and his partner Edwin Palmer, Decatur currently owns or operates 15 hotels, according to its Web site. In April 2005, New Orleans's Times-Picayune newspaper reported that the chain had annual revenue of about $50 million. It owns boutique hotels and also operates hotels under the Holiday Inn Express and the Omni brands,

In pre-Katrina New Orleans, Decatur was the city's largest local hotel operator. While the major lodging companies staked claim to the city's massive convention and meeting business with large, name-brand high-rises in the Central Business District, Decatur focused on smaller boutique properties scattered throughout tourist hubs.

After the hurricane, Mr. Quinn and the company moved more quickly than competitors to prepare their hotels to accommodate relief workers, volunteers and paying guests. In a news release in May, the company said it had donated more than 13,000 room nights to two volunteer organizations. Mr. Quinn said that the program was "our way of saying thank you to the people we couldn't rebuild without."

--Peter Sanders contributed to this article.

"I'm making the same or less than I earned in my country" depending on the week, said the 45-year-old single mother who earns $6.02 an hour and pays $200 a month for lodging.

Let's see, you're making above the minimum wage and you're receiving lodging for $200. a month. What in the he$$ are you complaining about? There are poverty level American citizens doing worse! On top of that, if you wouldn't have came here, American citizens would have done that job for $8.15 an hour. Just another case of "cheap labor" undermining American citizens desire for a better life! Hmmm, and to think, this is all approved and sanctioned by our government.