Hotels to Drop Weekly $10 Insurance Premiums

Eight Los Angeles hotels said Wednesday that they would stop charging union workers $10 weekly for health insurance premiums. The payments were imposed in July in an attempt to pressure the Unite Here union to accept a long-term labor contract.

In a letter to the union, hotel attorney Lisa M. van Krieken said the change was a goodwill gesture and the hotels “are not asking for anything in exchange.” She said the decision had nothing to do with a recent finding by the National Labor Relations Board general counsel that the charges were illegal.

Union members hailed the development as a major victory.

“This is just showing the employees that they’re backing off from their dirty campaign,” said Miguel Aguilar, a banquet server at the Sheraton Universal hotel and a member of the union negotiating committee. “People are really pumped up. Now they know the companies are scared of the power that we have.”

Union officials said they suspected that the hotels were merely cutting future liability in case they are ultimately forced to return all the payments collected since July. Hotel spokesman Fred Muir disagreed.

“That’s not our motivation, but it would have that effect,” he said.

The hotels, negotiating jointly as the Los Angeles Hotel Employer’s Council, could negotiate a settlement with the NLRB that would probably include returning the money collected. Or the hotels could fight the complaint in court. Muir said that decision had not been made.

The hotel council and union representatives began negotiating nearly a year ago, but talks have been stuck on disagreements over the contract expiration date. The union wants a short contract that expires in 2006, as part of a national campaign to line up contract expirations across the country.

The hotels, which include the Millennium Biltmore and Westin Century Plaza, have said they will not agree to a deal that gives the union such national leverage.

In late June, the hotels declared that talks had reached an impasse and they would impose the weekly insurance payment.

Union officials said about 500 of the nearly 3,000 union workers covered have lost their insurance because they could not make the payments.