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Fairmont Chateau Whistler paying back $85K in tips owed to banquet staff

Hotel says it changed the way it communicates service charges to guests following 2019 amendments to labour laws

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The Fairmont Chateau Whistler has agreed to pay back $85,000 in tips owed to banquet staff following complaints filed by the United Food and Commercial Workers (UFCW) Local 1518, according to a union release.

Banquet staff reportedly contacted the UFCW in 2018 after hotel management introduced a new tipping structure in which guest gratuities were withheld and used to subsidize management's wages, a contravention of the B.C. Employment Standards Act, the union said.

“These workers tried in vain to address the issue themselves. But they couldn’t make the employer listen or obey the law. That’s when they called us,” said Patrick Johnson, secretary-treasurer of UFCW 1518 in the release.

The union said banquet staff told the UFCW that the hotel took 20 per cent of the gratuities they earned and redistributed them to “Catering Services/Planning.” From there, the tips were paid out to catering sales managers, the union explained.

In an emailed statement, the Fairmont said it has "completed administrative adjustments, specific to the language in the banquet services contracts the hotel provides to its guests, to comply with changes to BC’s Employment Standards Act in May of 2019. Even though gratuities were never decreased or withheld, the hotel voluntarily decided to make retroactive payments to employees for the period following the legislative change. The hotel’s gratuity distribution system has always been and remains completely transparent and fully compliant with the Employment Standards Act. Our guests and employees are our top priority at Fairmont Chateau Whistler and we are committed to providing a positive, safe and fair workplace."

In a Jan. 24 letter obtained by Pique that was sent to Fairmont staff, GM Norm Mastalir wrote that the changes to the Employment Standards Act "required the hotel to change way it communicates with guests about service charges and surcharges. We have always advised Colleagues what percentage of service charges/surcharges would be distributed directly to them as gratuities. The new rules require us to expressly advise our guests of this as well."

Mastalir goes on to say that the hotel has agreed to make retroactive payments to applicable staff for the period between May 29, 2019, when the changes to the act went into effect, and "the time it became clear to the Hotel that changes were required to some of our contracts and communications." He said each retroactive payment "represents the difference between the gratuities you have already received for that period and the gratuities you would have received if the entire amount of the service charges/surcharges collected during that period were redistributed to Colleagues."

Although tip pooling is still allowed, following changes last spring to the Employment Standards Act, employers are no longer permitted to withhold or deduct worker-earned gratuities.

“When workers lack the collective voice and power of a union, it’s much easier for employers to break the law and exploit their employees,” Johnson said. “As a result of our advocacy and the subsequent investigation by the Employment Standards Branch, Fairmont Chateau Whistler will voluntarily repay about 60 of its employees $85,000. That is significant and a real win for those workers.”

The union said it based its two complaints to the Employment Standards Branch on a PowerPoint presentation the hotel gave to staff last year detailing its new gratuity redistribution plan.

In a follow-up email, a UFCW spokesperson said it isn't clear whether the contravention of labour laws is relegated to the banquet department "or whether in effect, the violation is widespread through other departments within the hotel and other Fairmont locations throughout B.C."

Pique has requested further comment from the Fairmont and will update this story if we hear back.

In the release, Johnson noted that the Fairmont faces no penalty for violating labour laws.

“Without serious repercussions for breaking our labour laws, employers will continue to abuse non-unionized workers. That’s why UFCW 1518 will continue to push for enforcement, and fight for fairness for all workers,” he said.

UFCW Local 1518 represents more than 24,000 members working in the community health, hospitality, retail, grocery, industrial, and professional sectors across B.C.

It has been active in Whistler since at least early 2018, when a group of Whistler Blackcomb (WB) ski instructors approached the union. Since dubbed the Whistler Workers Alliance, the group has set its lofty sights on potentially organizing WB’s entire 4,000-plus workforce.

Most recently, the UFCW has been assisting WB’s snowmaking department, which on Jan. 7 applied to formally unionize. Snowmaking employees' main concerns surround overtime pay and general wage increases, according to UFCW union organizer Keith Murdoch. The base wage for snowmaking employees is $14.85 an hour, and tops out at $25, he said.

Pique will continue to follow this story as it develops.