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Legal decisionmaking by hospitality managers

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Legal decisionmaking by hospitality managers

  1. 1. Legal Decision-making by Hospitality Managers <br />George Papadopoulos, <br />Attorney at Law, LL.M. (Cantab.)<br />IEMA Summer School<br />DokuzEylül University<br />Izmir<br />
  2. 2. Shouldn’t they be focusing solely on management?<br />Of course… <br />But, bare in mind that:<br /> In the day-to-day operation of a hospitality facility, it is the manager, not the company attorney, who will most influence the legal position of the operation.<br />“60 to 70 % of the decisions he made on a daily basis involve some type of legal dimension”. Robert James (founder of one of the largest hotel contract management companies in the US) <br />Why should hospitality managers care about the law? <br />
  3. 3. Choosing a business structure (organizational: company form / operational: owner-operator; franchise; management contract; real estate investment trust; condominium; long term lease) <br />Dealing with administrative agencies (e.g. responding to inquiries etc)<br />Getting into contracts (B2B, B2C)<br />Dealing with issues arising from the execution thereof<br />Complying with your legal responsibilities as a hospitality operator<br />Selecting & managing employees <br />Think of: <br />
  4. 4. Managers CANNOT monitor every piece of hospitality legislation (100 s of laws & regulations enacted each year in every jurisdiction concerning the provision of food, lodging, travel, and entertainment services) <br />How should hospitality managers deal with the law?<br />
  5. 5. 1. Preventative legal management<br />How should hospitality managers deal with the law?<br />
  6. 6. 2. Sound ethical behaviour <br />How should hospitality managers deal with the law?<br />
  7. 7. Reduce employee errors <br />Reduce litigation and liability <br />The Goal<br />
  8. 8. STEM<br /><ul><li>Select
  9. 9. Train
  10. 10. Educate
  11. 11. Manage and Motivate</li></ul>Preventative legal management<br />
  12. 12. Possible causes of litigation: <br /><ul><li>Employee’s negligence
  13. 13. Negligent hiring
  14. 14. Negligent supervision
  15. 15. Failure to properly train</li></ul>Why STEM ?<br />Vicarious Liability<br />
  16. 16. Is it legal?<br />Does it hurt anyone?<br />Is it fair?<br />Am I being honest?<br />Would I care if it happened to me?<br />Would I publicize my action?<br />What if everyone did it?<br />Ethical Behaviour<br />
  17. 17. Dealing with contracts<br />
  18. 18. <ul><li> Why?
  19. 19. How ? </li></ul>Get it in writing<br />Enforceability (in some cases)<br />Evidence <br />Email too, but be aware of qualified electronic signatures<br />(Dir. 99/93, Art. 1316-4 CC, Art. 287, 288 CPC, Decr. 2001-272, §126a BGB, art. 3 greek P.D. 150/2001 )<br />
  20. 20. Make sure you follow the “mirror image” rule <br />i.e. a clear and unequivocal offer must be mirrored by an equally clear and unequivocal acceptance<br />Otherwise, the “battle of the forms” may lead to uncertainty <br />(UCC § 2-202; Butler v Ex-Cell-O-Corporation Ltd. [1979] 1 WLR 401; Gibson v Manchester City Council [1979] 1 WLR 294; § 150 BGB, Art. 195; 196 gr.CC) <br />Use clear, unequivocal language <br />
  21. 21. On your part<br /><ul><li>Read & understand the terms of the contract
  22. 22. Ask for clarification if necessary
  23. 23. Note time deadlines for performance
  24. 24. Educate staff
  25. 25. Ensure the performance of third parties </li></ul>Ensure execution <br />
  26. 26. By the other party<br /><ul><li>Security interests/charge
  27. 27. Personal surety/guarantee
  28. 28. Mortgage/hypothecation
  29. 29. Bank’s letter of guarantee
  30. 30. Retention of title
  31. 31. Bills of exchange, checks </li></ul>Ensure execution <br />
  32. 32. By the other party<br /><ul><li>Assignment of rights
  33. 33. Liquidated Damages, Penalty clauses </li></ul>Ensure execution <br />
  34. 34. By the other party<br /><ul><li>Guaranteed Reservation : A contract to provide a confirmed reservation in which the provider guarantees the guest’s reservation will be honored regardless of time of arrival, but the guest will be charged if he or she no-shows the reservation. Prepayment or payment authorization is required.</li></ul>Ensure execution <br />
  35. 35. Lawsuit <br />Specific performance;<br />Termination of contract; Rescission; <br />Damages<br />ADR (Alternative Dispute Resolution) <br />Negotiation; <br />Mediation; <br />Conciliation; <br />Arbitration<br />What if something goes wrong?<br />
  36. 36. Negotiation<br />“A discussion in order to reach an agreement”<br />
  37. 37. The Competitive Style<br />The Cooperative Style<br />Negotiation<br />
  38. 38. The Goal: <br />Obtain concessions while making as few concessions as possible <br />The Approach: <br />Positional: <br />1st: determine bottom line<br />2nd : ascertain opening position<br />3rd: negotiate<br />The Competitive Style<br />
  39. 39. Characteristics<br /><ul><li>Open with high demands
  40. 40. Take strong/specific position
  41. 41. Reveal little information
  42. 42. No empathy
  43. 43. Argumentative rather than conciliatory
  44. 44. Narrow issues for negotiation</li></ul>The Competitive Style<br />
  45. 45. The cooperative negotiator aims to: <br />Put the client first<br />Be fair and use objective criteria<br />Maintain good relations<br />Look for common ground <br />Make reasonable offers <br />Expand the negotiation & Add value for both parties<br />Objective is to maximize gains for all parties and reach a mutually beneficial agreement (win-win)<br />The Cooperative (problem solving) style<br />
  46. 46. Separate people from the problem<br />Focus on interests (what are the parties seeking); not on positions<br />Be creative. Invent options for mutual gains<br />Agree upon objective criteria<br />Know your best alternative to a negotiated agreement (BATNA) <br />Tips<br />
  47. 47. Stephen Barth, Hospitality Law, 3rd ed., 2009. <br />Michael Boella& Allan Panett, Principles of Hospitality Law, 2nd ed., 1999<br />Jack Jefferies, Understanding hospitality law, 1990<br />Norman Cournoyer & Anthony Marshall, Hotel, restaurant and travel law, 1983<br />John R. Goodwin, Hotel and hospitality law, 1992<br />John R. Goodwin, Jolie R. Gaston, Hotel, hospitality, and tourism law, 1997<br />David K. Hayes, Jack D. Ninemeier, Human resources management in the hospitality industry, 2008<br />L.K. Singh, Trends In Travel And Tourism And Law, 2008<br /> Trevor C. Atherton and Trudie A. Atherton, Tourism, Travel and Hospitality Law, 1999<br />Frederic Miller, Agnes Vandome and John McBrewster, Hospitality law, 2010<br />Mark Poustie and Norman Geddes , Hospitality and Tourism Law, 1998<br />Further reading<br />
  48. 48. Cooper , C. , J. Fletcher , D. Gilbert , R. Shepherd , and S. Wanhill (eds.). Tourism: Principles and Practice, 1998<br />Tom Baum , Human Resource Management for Tourism, Hospitality, and Leisure: An International Perspective, 2006 <br />L. Bihl, Droit des hôtels, restaurants et campings, 1981<br />F. Boulanger, Tourisme et loisirs dans les droits privées européens, 1996<br />C. Bureaux et E. Bureaux , Droit et Organisation du tourisme en France, 1988<br />J. Calais Auloy, Consumérisme et droit du tourisme, 1989<br />Daniel Desurvivre, Le timeshareou la multipropriété échangée, 1995<br />Pierre Py, Droit du tourisme, 2002<br />F. Servoin, Institutions touristiques et Droit du tourisme , 1981<br />
  49. 49. Richard Shell, Bargaining for Advantage—Negotiations Strategies for Reasonable People, 2006<br />Robert H. Mnookin, Scott R. Peppet and Andrew S. Tulumello, Beyond Winning: Negotiating to Create Value in Deals and Disputes , 2000<br />Gilbert Ahamer, Surfing Global Change: Negotiating Sustainable Solutions, 2006<br />Douglas Stone, Bruce Patton and Shelia Heen, Difficult Conversations: How to Discuss What Matters Most , 1999<br />Roger Fisher and Danny Ertel, Getting Ready to Negotiate: The Getting to YES Workbook , 1999<br />LaviniaHall, Negotiation: Strategies for Mutual Gain, 1993 <br />Peter Stark and Jane Flaherty, The Only Negotiating Guide You'll Ever Need , 2002<br />
  50. 50. Thank you! <br />
  51. 51. George Papadopoulos<br />Attorney at law, LL.M. (Cantab.)<br />E-mail:<br /><br />Contact Info<br />