UNIT HERE 11 & 40 Locals Demand US Government Stop Forgiving Westmont-Related Payroll Protection Loans

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LOS ANGELES–() – UNITE HERE Local 11, which represents 32,000 hospitality workers in Southern California, and UNITE HERE Local 40, which has over 5,000 members in British Columbia, wrote to the US Small Business Administration calling for an immediate end to the forgiveness of the $ 34 million in payroll protection program (“PPP”) loans associated with the Westmont Hospitality Group. Although Congress intended to use small business PPP loans, Westmont claims to be one of the the largest private hotel organizations in the world, which owns and operates more than 500 hotels.I

Westmont took advantage of the loophole This has allowed large hotel chains to apply for loans originally intended for small businesses, and the US Small Business Administration, which oversees PPPs, has already written off one loan related to the firm’s corporate office in Houston. PPP borrowers had to spend 60% of the funds from PPP loans on wages claim full loan forgiveness,ii but the SBA does not disclose how Westmont used its PPP loans.

The letter asks for an investigation into 35 loans related to Westmont and asks how many of the 4,024 employees reported have been laid off or laid off without employment benefits. The two loans totaling $ 5.49 million included the address of the Hyatt Regency Jacksonville in Florida, which was linked to the Westmont headquarters in Houston. bought in 2017… WARN notices filed by the hotel in 2020 indicate that 121 employees were “affected by permanent layoffs” and 92 employees were “affected by the conversion of paid leave to non-benefit layoffs.”

In total, UNITE HERE Local 11 analysis (available here) shows that hotels raised $ 13.9 billion in PPPs, of which $ 3.3 billion came through loopholes that allow large chains like Westmont to lend and lend to hotels 40% more than other borrowers in 2021 year.iii

As of July 1, the SBA has forgiven a total of $ 4.2 billion in PPP loans to US hotels, converting them into grants without disclosing how they were spent. While Congress intended to use PPP funds to get workers back to wages, U.S. hotel jobs from May 2020 to June 2021 averaged just 20% more than hotel jobs in April 2020 after the pandemic caused a sharp drop in hotel employment.iv

The letter also asks if Westmont has received any loans related to the Pan Pacific Hotel in Vancouver, British Columbia. Westmont-owned hotel about 100 long-term laid off workers were dismissedfor no reason, in the midst of a pandemic. The hotel also allegedly urged workers to give up full-time status and severance pay, and then fired some of them anyway. Two class action lawsuitss was filed against the hotel on behalf of the laid-off workers.

JOIN HERE Local 11 represents hundreds of employees at Hilton Hotel & Suites, operated by Westmont, Santa Monica, California, and Westdrift Manhattan Beach, California.

UNIT HERE Local 11 is a network of over 32,000 employees in hotels, restaurants, airports, sports arenas and convention centers in So. California and Arizona.

UNITE HERE Local 40 represents over 5,000 employees in British Columbia hotels, restaurants, airports, sports arenas and convention centers.


I Westmont Hospitality Group website. https://www.whg.com/

ii PPP Loan Forgiveness, as of June 21, 2021 https://www.sba.gov/funding-programs/loans/covid-19-relief-options/paycheck-protection-program/ppp-loan-forgiveness

iii Local 11 analysis used May 2021 data published by the SBA. As of July 1, the amount of PPP loans to US hotels increased to $ 13.9 billion.

iv Data for the sector “Accommodation: NAICS 721” from the Bureau of Labor Statistics, available at https://data.bls.gov/timeseries/CES7072100001?amp%253bdata_tool=XGtable&output_view=data&include_graphs=true

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