Hotels' union talks break off but pact holds; more 'chaos' expected.

Contract negotiations affecting 5,000 local hotel employees officially broke off last week, despite efforts by the Hotel & Restaurant Employees Union and the Hotel & Restaurant Employers Council to come to an agreement.

Regarded as a citywide model for the hotel industry, the three-year wage and benefits contract expired April 15, though the union said it will continue to be honored until a new one is agreed upon.

"It was just left at that," said Local 11 President Maria Elena Durazo. So far there is no other meeting scheduled. But, said Durazo, "they (the hotel employers) did not say that was their last and final offer."

Highlights of the day-long meeting on April 15 included a union proposal for a wage increase, health benefits affordable for their workers and job security in the event of a hotel sale, bankruptcy or renovation. The employers council -- a 10-member coalition of hotels situated in Beverly Hills and downtown L.A. -- proposed an across-the-board wage freeze for one year and increased health benefit co-payments by employees.

According to a union representative, over the life of the proposed five-year contract, any wage increase after the one year freeze would be undermined by increased health coverage payments.

Said a representative, Local 11 would have accepted the one-year wage freeze if the hotels maintained the same health benefits and agreed to the job security language. But, said Local 11's Durazo of the hotels, "they want it all."

She confirmed that there will be no strike. "But, we'll create the same level of chaos inside the hotel and outside," she warned, calling planned actions a form of "civil disobedience."

Local 11 staged a rally in Pershing Square in downtown L.A. on April 10. Their cause was spotlighted by an appearance from the Rev. Jesse Jackson.

A strike now, Durazo said, "is not smart with the low level of (hotel) business."

She said that the union will send out brochures and a union-produced video, "City on the Edge," to convention and meeting planners across the country "to present the real picture of what's going on here."

Durazo challenged city leaders to "take a stand" on this issue because diminished worker benefits would "increase the burden on the county health system."

Irv Baldwin, executive director of the Hotel & Restaurant Employers Council, was unavailable for comment. And representatives at some of the council's hotels declined comment.

Economists blame not the financially strapped hotel industry or the membership-protecting union, but the recession.

"It's not their fault," said Arthur Shaw, chief economist for the L.A. Chamber of Commerce. "The hotel industry is in difficult financial shape," he said, noting that the Los Angeles tourism industry "has been living off of foreign tourists."

With the suffering state of some Asian economies, he said, American tourists would have to pick up the slack here to prevent the business from declining. But, he warned, they "won't come if there is a big labor strike or severe labor unrest."

The union-hotel confrontation "will be a long and painful process," said Shaw.

According to the county's Economic Development Corp., tourism is the second-largest industry in Los Angeles County, behind business and management services. Made up of hotels and motels, amusement and recreation services and certain retailing and transportation businesses, the tourism industry has been expected to grow stronger in 1992.

"A lot of people were looking for a rebound this year," said Jack Kyser, chief economist at the Economic Development Corp.

He, along with Shaw, said the recession plays a big part in negotiations of this nature.

"It's tough to get an increase in wages when the economy's in the tank," Kyser pointed out.