HTM 41100

Hospitality & Tourism Law

Chapter 14
Employment
Objectives
Identify, comprehend, and
analyze special topics within
hospitality law, including food
and alcohol liability, travel
agent relationships,
employment issues, franchising,
copyright and trademarks,
licensing and casino law.
HTM 41100
Hospitality & Tourism Law
Chapter 14
Employment
Objectives
Identify, comprehend, and
analyze special topics within
hospitality law, including food
and alcohol liability, travel
agent relationships,
employment issues, franchising,
copyright and trademarks,
licensing and casino law.
HTM 41100 Hospitality & Tourism Law
Chapter 14 Employment

Objectives
Identify, comprehend, and analyze special topics within hospitality law, including food and
alcohol liability, travel agent relationships, employment issues, franchising, copyright and
trademarks, licensing and casino law.

Fair Labor Standards Act (FLSA)

-The Fair Labor Standards Act (FLSA) is a federal law which establishes minimum
wage, overtime pay eligibility, recordkeeping, and child labor standards affecting
full-time and part-time workers in the private sector and in federal, state, and
local governments.

a. Minimum wage requirements

i. Exception to FSLA requirements:
1. Low Sales
2. Tip exemption Youth Exception
b. Overtime Pay
i. If an employee works over 40 hours in one week then that employee must be
paid 1.5 times his/her normal wage for those hours above 40.
ii. Exempt employee:
1. Executive employees
2. Manager trainees:
3. Administrative employees
4. Professional employees
c. Time worked – employees must be paid for the following:
i. Time actually spent working
ii. Authorized coffee and snack breaks
iii. Meetings
iv. Training sessions
v. Travel from job sites to job site or to customers
vi. Rest periods of 20 minutes or less
vii. Clearing the cash register or totaling receipts after normal shift
d. Split shift
i. If an employee is schedule to work a split shift with a break longer than 20
minute between shifts then the time between shifts does not count as time worked.
ii. If an employee is sent home part way through the day then the time worked
stops when the employee stops work.
e. Equal pay for equal work
i. Equal pay Act (EPA) states that men an women doing the same job must
receive the same pay.
ii. Comparable worth standard:

iii. Be careful that certain jobs are not male or female only unless it can be
justified as a necessary for the job.
f. Retaliatory discharge
i. You are forbidden to take retaliatory actions against a person who has brought
suit against you under FSLA
ii. This needs to be communicated to all and enforced.
g. Restrictions on child labor
i. Hours: There are a number of rules that concerning how long and at what times
individuals under the age of 18 can work.
ii. Tasks: There tasks that minors cannot perform because they are considered too
dangerous. h. Enforcement a violation may be pursed in one of two ways i. File a
claim with the Wage and Hour division of the United States Department of Labor
 ii. Commence a lawsuit against the employer seeking damages and attorney fees
iii. If the employers actions are willful the penalties can include jail time

Illegal Job Discrimination

i. You cannot base your termination on the fact that a person is or is not a
member of a protected class.
i. Protected classes
ii. Race
iii. Skin color
iv. Religion
v. Gender
vi. Pregnancy
vii. Disability
viii. Age (over 40 year) ix. Union membership
j. Disparate Treatment Discrimination: Intentional discrimination based on protected
classes
k. Disparate Impact Discrimination: Unintentional consequences of intentional acts or
policies that impact protected classes differently

Title VII of Civil Rights Act of 1964

l. Applies to business with more than 15 employees. m. Prohibits the following to be
based on a person membership in a protected class
i. Hiring and firing
ii. Promotion
iii. Access to training
iv. Discipline
v. Work and shift assignments
vi. Vacation time
vii. Etc.
n. Remedies
i. An injunction ordering the offending conduct cease.
ii. Require the employer to adopt and implement a policy forbidding
discrimination.
iii. Attorney's fee
iv. Back pay and other compensatory damages which are capped based on the
size of the business
v. Punitive damages can only be collected if the employer's actions were illegal.
o. Bona Fide Occupational Qualification Defense
i. Relieves employer of liability for disparate treatment if selecting a in favor of
one group over another in the protected classes is reasonably necessary for normal
operation.
ii. To use this defense two elements must be present:
1. The job requires a worker of a particular gender, religion, age, or
national origin.
2. Such requirement is a necessity to the essence of the business
p. Business Necessity Defense
 i. Relieves employer of liability for disparate impact if the requirements of the
business put someone in the protected classes at a employment disadvantage.
ii. To use this defense it must be obvious that the selection criteria is directly
related to job performance.
q. Filing a Complaint
i. Complaint must first be filed with the Equal Employment Opportunity
Commission (EEOC).
ii. The EEOC has 180 days to act on the complaint.
iii. If the EEOC does not complete the action in 180 days the plaintiff can request
a right to sue letter.
iv. If the EEOC does not find reasonable evidence that discrimination took place
the plaintiff can still sue in court.
Prohibited Interview Questions: You cannot ask questions concerning the
following:
r. Race
s. National origin
t. Citizenship
u. Age
v. Marital status
w. Children
x. Religion
y. Disabilities or medical conditions
z. Arrest record

Race Discrimination
aa. “Discriminatory preferences for any racial group, minority or majority” cannot be the
basis of employment.
bb. All races must be treated the same when it comes to hiring, firing, promoting and
disciplining.
cc. Employers must protect employees from a racially hostile work environment.
dd. Employers must a policy in place to prevent a hostile work environment.
ee. Those policies must be enforced.
ff. Training must be provided on the policy for all employees

Religious Discrimination
gg. Employers must make reasonable accommodations to support religious freedom of
employees and protect them from a religiously hostile work environment.
hh. Reasonable accommodations include adjustment to clothing requirements.
ii. Reasonable accommodations must be made to allow employees to have days off for
religious observances. Gender Based Discrimination
jj. It is generally illegal to show discriminatory preference for either gender.
kk. You can use what would otherwise be considered discriminatory practices if you can
show such practices are necessary because of bona fide occupational qualification or
business necessity.
ll. Employers must make a good faith effort to design jobs to accommodate both
genders.
mm. Gender differentiated grooming standards are acceptable provided:
i. They are related to a legitimate concern for the business image created by
the employees.
ii. ii. The requirements are not significantly more burdensome for one
gender. Sexual harassment
nn. Quid pro quo sexual harassment
i. The employee is threatened that
his/her employment will be threatened if he/she does not submit to unwelcome
sexual advances.
ii. The employee is promised a job benefit for submitting to an unwelcome sexual
advance.
iii. Gender Based Discrimination

oo. Hostile environment sexual harassment

i. Employer permits behavior by other employees that is considered sexually
offensive. The behavior includes:
1. Comments
2. Jokes
3. Touching including brushing up against the victim
4. Personal gifts
5. Repeated unwelcome requests for a date
6. Obscene gestures
7. Obscene pictures
8. Sexual stereotyping
9. Gender Based Discrimination
ii. Frequency of offending conduct: Unless it is a particularly serious event, a
single event is not sufficient to constitute sexual harassment.
pp. Perpetrators
i. Management
ii. Co-workers iii. Customers
qq. Location of harassments - generally employers are not responsible for harassment that
occurs outside the scope of employment
rr. Employer Liability
i. Quid pro quo sexual harassment: Employer is liable
ii. Hostile environment sexual harassment
1. Employer is generally not liable if the following can be show:
2. Not adverse employment action was taken against the employee
(victim)
3. The employer exercised reasonable care to prevent and promptly
corrected any sexually harassing behavior
4. The plaintiff unreasonably failed to take advantage of preventive or
corrective opportunities provided by the employer
5. Policies and complaint procedures
a. Must have clear policies in place to prevent sexual harassment
b. Non-threatening procedures must be in place for a victim to report
harassment
 c. Must prompt action to investigate and correct sexual harassing
conduct or situations. To include, but not limited to
d. For quid pro quo sexual harassment
i. Changing the worksite of the harasser
ii. Terminating the harasser
iii. Other punitive action against the harasser
e. For hostile environment
i. Mandate that objective behavior is discontinued
ii. Retraining of entire staff
iii.Retraining of individual
iv.Punitive action against harasser up to an including
termination.

Pregnancy Discrimination:
ss. Pregnancy must be treated like other medical disabilities
tt. If business necessity renders the person unfit then the employer can require the
pregnant employee to take a leave of action until she is physically able to return.
uu. If the employer does not think the employee is able to do the job or is concerned for
the employee’s safety and the employee want to continue to work, you may want to
consult your attorney for specific guidance before forcing her to that leave.
vv. Abortion issue: abortion is legal, discriminating against a person who has an abortion
may result in a religious discrimination suit.

Age Base Discrimination

ww. Age Discrimination in Employment Act of 1967 bar discrimination against
individuals 40 year or older.
xx. It does not bar reverse discrimination based on age (General Dynamics Land
Systems, Inc. v. Cline, No. 02-1080 (U.S. Feb. 24, 2004)).
yy. Some states forbid reverse age discrimination.
zz. Employers need to be careful how they pitch early retirement packages to older
workers to avoid liability for age discrimination.
(http://www.eeonews.com/news/adea/reverseage.html)

Americans with Disability Act

aaa. Makes it illegal for employers to discriminate against someone who is disabled, but
with reasonable accommodations can perform the task.
bbb. A disability is a long-term mental or physical impairment that limits a person’s
abilities to walk, see, hear, perform manual tasks, learn, work, or care for him/herself.
ccc. Applies to companies with 15 or more employees.
ddd. Employers must make reasonable accommodations to allow disabled employees to
perform essential tasks.
eee. Essential tasks are the core responsibilities associated with the job.
fff. If accommodations create an undue hardship on the business or other employees
ggg. Employers cannot make hiring decision based on nonessential tasks.
hhh. Employers are not required to give preference to disabled individuals, although
there are often incentives to hire disabled individuals.
 iii. Drugs and Illnesses:
i.The use of illegal drugs is not protected by the ADA.
ii. Individuals with infectious or communicable diseases are not protected by
ADA if the disease is on the list of diseases developed by the Secretary of Health
and Human Services
iii. A person with AIDS is protected by ADA provided the disease has rendered
the person disabled.
iv.Filing a claim: A claim can be filed with the EEOC or pursed in court.
jjj. Remedies
i. Compensatory damages
ii. Punitive damages
iii. Attorney’s fees
iv. Expert witness fees
iv. Reinstatement
v. Back pay
vi.
Mandatory verification of Employment Status
kkk. Immigrations Reform and Control Act of 1986 requires employers to verify that
applicants have the right to work in the country.
lll. The law specifies acceptable documentation to verify status.
mmm. Does not hold employers liable if forged documents are used, provided they
appear on the face to be genuine.
nnn. Prohibits discrimination against individual who have the right to work in this
country
ooo. However, if two candidates are equal it give preference to the U.S. citizen.
ppp. Resume fraud can be grounds for termination, it is also a crime

Negligent hiring: If an employer does not responsibly check the background of a employee
before hiring then the employer may be liable for that employees actions even the actions are
outside his job description.

HTM 41100
Hospitality & Tourism Law
Chapter 15
Regulation and Licensing
Objectives
Identify, comprehend, and
analyze special topics within
hospitality law, including food
and alcohol liability, travel
agent relationships,
employment issues, franchising,
copyright and trademarks,
licensing and casino law.
1.
Trademarks: Word(s), name,
symbol, or device adopted and
used by a manufacture
or merchant to identify its
goods and distinguish them
from competitor’s goods
2.
Service mark: Word(s), name,
symbol, or device adopted and
used by a business to
identify its services and
distinguish them from
competitor’s services
Infringement
a. To win an infringement case
you must prove that
i. You had ownership of the
trademark or service mark.
ii. The defendant’s use of the
trademark or service mark is
likely to cause
confusion as to the actual
source of product or service.
b. Ownership of a Trademark
or Service Mark: You can claim
ownership of a
trademark or service mark one
of two ways:
i. Be the first to use the mark
ii. Register the mark
c. Likelihood of Confusion:
Likelihood of confusion is
established in one of two
ways:
i. Provide proof of actual
confusion by customers.
ii. Provide evidence
establishing a strong potential
for confusion.
iii. Test to determine likeliness
of confusion
1. Strength of the mark- how
long it has been used, how
much has it
been advertised, how familiar
are customers with it?
2. How related are the goods or
services involved.
3. How similar are that actual
marks.
4. Evidence of actual
confusion.
5. Marketing done by each
party.
6. Degree of care exercised by
consumers when purchasing the
product or service.
7. The defendant’s intent when
adopting the mark.
8. The likelihood the plaintiff
will expand its operation.
9. Geographic proximity
d. Penalties
HTM 41100 Hospitality & Tourism Law Chapter 15 Regulation and Licensing

Objectives
Identify, comprehend, and analyze special topics within hospitality law, including food and
alcohol liability, travel agent relationships, employment issues, franchising, copyright and
trademarks, licensing and casino law.

1. Trademarks: Word(s), name, symbol, or device adopted and used by a manufacture or

merchant to identify its goods and distinguish them from competitor’s goods

2. Service mark: Word(s), name, symbol, or device adopted and used by a business to identify
its services and distinguish them from competitor’s services

Infringement
a. To win an infringement case you must prove that
i. You had ownership of the trademark or service mark.
ii. The defendant’s use of the trademark or service mark is likely to cause
confusion as to the actual source of product or service.
b. Ownership of a Trademark or Service Mark: You can claim ownership of a trademark
or service mark one of two ways:
i. Be the first to use the mark
ii. Register the mark
c. Likelihood of Confusion: Likelihood of confusion is established in one of two ways:
i. Provide proof of actual confusion by customers.
ii. Provide evidence establishing a strong potential for confusion.
iii. Test to determine likeliness of confusion
1. Strength of the mark- how long it has been used, how much has it been
advertised, how familiar are customers with it?
2. How related are the goods or services involved.
3. How similar are that actual marks.
4. Evidence of actual confusion.
5. Marketing done by each party.
 6. Degree of care exercised by consumers when purchasing the product or
service.
7. The defendant’s intent when adopting the mark.
8. The likelihood the plaintiff will expand its operation.
9. Geographic proximity
d. Penalties
i. Injunction prohibiting further infringement.
ii. Return of the profits diverted from marker owner.
iii. Fines.
e. Descriptive Terms
i. Descriptive terms may not be trademarked unless it can be proven that they
have a secondary meeting.
ii. Descriptive terms can be used in a trademark
f. Public Domain
i. When a trademark becomes part of common speech then it becomes part of the
public domain and trademark protection is lost.
ii. Examples include:
1. Aspirin
2. Frisbee
3. Cellophane
4. Cardboard
5. Kleenex
6. Escalator

Registering a Trademark
g. Trademark need not be registered to be enforced, but registration helps discourage
unauthorized use of your trademark and make it easier to prove infringement.
h. Trademarks can be registered at the Federal or State level
i. It is generally cheaper and easier to register at the State level.
j. If your business is likely to expand into another state then you should consider a
federal registration.
3. Cybersquatting: The Anitcybersquatting Consumer Protection Act makes it illegal to register
a domain that is close enough to an existing trademark as to result in confusion if the purpose of
registering that is to make a profit.

Copyright
a. Is an exclusive right of the owner to reproduce or license reproduction of
i. Literature
ii. Art
iii.Music
iv. Drama
v. Sculpture
vi. Motion pictures
vii. Computer software
viii. Audiovisual works including broadcasts of sporting events
b. The right is separate of the work itself
c. The work may be sold and the copyright ownership maintained
d. The copyright may be sold or transferred and the work maintained by the original owners
e. Illegal use of copyrighted material
i. Cannot intercept and use satellite or cable broadcasts without contracting with the provider.
ii. Cannot use music or video received by means other than satellite or cable that was meant for
personal use for public purposes.
iii. Exception: music or video played over “home-type” device for incidental entertainment of
patrons in small business or professional establishments. To claim exception
1. The entertainment must be incidental.
2. The system must not use not “home-type” components.
3. It must be configured in a way normally found in a home.
f. Copyrights extend to live music performed, disk jockeys, or jukeboxes.
g. To avoid legal problems license can to use the copyrighted material can be procured through
American Society of Composers, Authors, and Publishers (ASCAP) or Broadcast Music, Inc.
(BMI)

Anti-Trust Issues
h. Per se violations: are always illegal
i. Price-fixing agreements
ii. Vertical price fixing*
iii. Territorial division agreements
iv. Group boycott
v. Resale price-maintenance agreements*
vi. Price discrimination???
vii. Exclusive deal contracts
*Leegin Creative Leather Works v. PSKS Inc.: Overturning a 1911 antitrust rule barring
manufacturers from setting minimum retail prices for their products, in a decision ensuring that
certain pricing deals between manufacurers and retailers are no longer automatically illegal –
vote was 5-4 (http://www.usatoday.com/news/washington/2007-06-28-major-court-
rulings_N.htm)
i. Rule of reason: not always illegal. The benefits are weighted against the anticompetitive
effects
i. Territorial restrictions
ii. Monopoly
iii. Tying agreements
iv. Mergers

Franchising
j. An agreement in which the owner of a trademark, service mark, or copyright licenses
others to use the trademark, service mark, or copyright.
k. Benefits:
i. Franchisee
1. Reputation of franchisor
2. Technical assistance from the franchisor
ii. Franchisor
1. Revenue
 2. Greater market exposure
l. Encroachment: when the franchisor licenses another franchisee to establish a business
within close proximity to an established franchisee.
i. Unless spelled out in contract it is legal in most states
ii. Few states (California) say a franchisee’s rights to protection from
encroachment is implied in a franchise agreement (within limits)
m. Fraud and breach of contract by franchisor: Franchisors must provide a potential
franchisee with a prospectus at lease 10 days before accepting any money
n. Tying arrangements:
i. Are not per se violations
ii. Courts have said franchisors can use typing arrangements to ensure product
consistency
o. Termination of a franchise
i. Most states limit the circumstances under which a franchisor can terminate a
franchise
ii. Repeated failure to pay franchise fees
iii. Repeated violation of franchise standards
iv. Once a franchise is terminated the franchisee must cease to use trademark,
service mark, or copyright.

Guest Register
p. Hotels must maintain guest registers
q. Use by law enforcement – in certain states law enforcement does not need a warrant to
look at the register.
r. In many states it is illegal for hotels to knowingly allow someone to register with a
false name.
s. Many states require the register to be retained for several years.

Rates
t. Hotels are prohibited from charging prices higher than their posted rates
u. Different customers can be charged different rates as long as it does not constitute
illegal discrimination of a protected group

Licensing
v. The government may require various licenses be obtained to operate a business
w. Considerations for issuing/denying of a license:
x. Type of business
i. Size of business
ii. Impact on community
iii. Applicants reputation
iv. Community sentiment
v. Zoning
y. Consequences for operating without a license
i. Penalties and fines
ii. Loss of protection of the law – cannot enforce contracts
iii. Revocation or suspension of a license cannot be done without due process
Zoning
z. Used to balance development with the quality of life for residence
aa. Limits how land/property can be used.
bb. If a person wishes to use a property for reason not permitted by zoning then the
person can seek to change the zoning or apply for a variance

5
Licensing
v. The government may require
various licenses be obtained to
operate a business
w. Considerations for
issuing/denying of a license:
x. Type of business
i. Size of business
ii. Impact on community
iii. Applicants reputation
iv. Community sentiment
v. Zoning
y. Consequences for operating
without a license
i. Penalties and fines
ii. Loss of protection of the law
– cannot enforce contracts
iii. Revocation or suspension of
a license cannot be done
without due
process
Zoning
z. Used to balance development
with the quality of life for
residence
aa. Limits how land/property
can be used.
bb. If a person wishes to use a
property for reason not permitta
variance.