HospitalityLawyer.com - Frequently Asked Questions Library

My hotel offered a room / meal package over New Year's that required a deposit equal to the total package price, but some guests canceled the day of the event. Do I have to refund their deposit?

It is perfectly legal to require payment prior to providing services, even though that is not how we usually do business in the hotel industry. Theaters, cinemas, and amusement parks, however, are all examples of businesses that require payment before the guest receives their services. It is the right of hotels and restaurants to make full or partial pre-payment a condition of their contracts. It is the right of the guest, however, to refuse this contract offer and take their business elsewhere should they wish to do so.

In your case, you must follow the agreement you made at the time you accepted the deposit. In addition, if you are a franchise property, your franchisor may have procedures you must follow. Hopefully, that agreement was in writing. It is never a good idea to let your sales or reservation staff accept and post a deposit unless it is accompanied by a signed contract spelling out your cancellation policy.

Also, remember that while it may be perfectly legal for you to keep all or part of the deposit, it may not make good business sense to do so. This is especially true if keeping the deposit will alienate a good customer. Like many legal difficulties, this one is best solved before it happens. It is always a good idea to get a signed contract when you accept a deposit for services.

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What do the letters "L.P." stand for after a company's name?

L.P. is the acronym for "Limited Partnership." While a sole proprietorship has only one owner, and a general partnership may consist of several owners, a limited partnership consists of two classes of owners. They are the limited partner and the general partner. The limited partner is simply someone who invests money in the partnership. The general partner may or may not be an investor, but serves as the business's operating and financial manager. Limited partnerships have many of the liability limiting advantages of a corporation, but also include favorable tax advantages. State laws can vary in this area, however, so consult an attorney who specializes in organizational structure to determine the special circumstances of your own state.

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My accountant is suggesting an "S-corp" for the restaurant my wife and I want to start. Is that a good idea?

It could be. An "S" corporation is also known as a "Sub-Chapter S" corporation. The "S" corporation format makes good sense for many hospitality businesses, such as family-owned operations. The requirements for establishing and maintaining an "S" corporation status include:

1. A limit of no more than 35 shareholders;

2. The issuance of only one class of stock;

3. A requirement that all shareholders are U.S. citizens;

4. All shareholders must be individuals, rather than corporations; and

5. The "S" corporation operates on a calendar year financial basis.

In an "S" corporation, any profits from the business are distributed directly to the shareholders in proportion to their ownership of the corporation. The profits are reported on the individual owners' tax returns and are taxed at the individuals' taxable rates, which is similar to the favorable taxation treatment of a partnership. Remember that liability limitation is just as important an issue as taxation, however, so be sure to consider that aspect as well.

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More and more places are becoming non-smoking; so don't be so sure your customers will object. This question here, however, is not about smoking, but rather about franchisor and franchisee agreements.

The franchise agreement you signed with your franchisor should answer your question.

Generally, franchisors will require that the franchisee not only agree to follow the standard operating procedures in effect at the time of an agreement signing, but also any changes made by the franchisor at a later time. Read your franchise agreement. If you have misplaced it, ask your franchisor for a replacement copy of the original. If after reviewing the document, you are still not sure, talk to your franchise representative, and your attorney.

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What is a FOC?

FOC stands for "Franchise Offering Circular." Some states have franchise investment laws that require franchisors to provide a pre-sale disclosure document (FOC) to potential franchisees. These states treat the sale of a franchise like the sale of a security. They typically prohibit the offer or sale of a franchise within their state until a company's FOC has been filed of public record with, and registered by, a designated state agency. An FOC will generally include:

1. A description of the franchisor and the type of license it is offering;

2. The business experience of the franchise company's owners and/or managers;

3. Initial fees, continuing fees and royalties, if required;

4. Initial investment estimates;

5. The licensee's obligations;

6. The licensor's obligations;

7. Policies about the geographic territory protected by the license agreement;

8. Restrictions on what the licensee may sell and how it may be sold;

9. Renewal and termination policies;

10. Transfer of ownership policies;

11. Claims regarding average earnings or profitability of current franchisees;

12. Locations of current franchisees;

13. A sample franchise (license) agreement;

14. Any information required by a specific state (i.e. California, Utah, Maine, etc.); and

15. The name and address of the legal representative of the franchisor.

States that require FOC's give franchisees important rights. Check with your Secretary of State office or your attorney to see if your state has such a requirement.

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What type of shoes can I require my employees to wear to help reduce the chances of a slip and fall accident?

First, it's great that you are taking this step to prevent mis-steps! It is, of course, perfectly legal to take steps to reduce your worker's compensation and insurance costs by requiring proper footwear at work. The type of footwear you should require depends on the floor surface(s) in your establishment. Use the following chart;

Shoe Type

Plastic (Vinyl) Best With Most floors Not Good For Greasy areas

Leather Best With Wet and greasy concrete, ceramic tile Not Good For Dry surfaces

Hard Rubber Best With Greasy concrete or wood Not Good For Ceramic tile, wet or dry concrete or wood

Chemi-Gum Cord Best With Greasy areas Not good for Areas with hot metals

Cushioned crepe rubber Best With Dry or wet rough concrete Not good for Ceramic tile, smooth concrete or wood

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What's the difference between a title and a deed? Aren't they the same?

No, they are not. A title is a legally recognized right to the possession and ownership of some property.

A deed is the formal document used to transfer ownership of real property from one person or entity to another. A deed will consist of the date, the names and descriptions of the parties involved in the property transfer, the consideration, a full description of the property, and any exceptions to the transfer.

Whether you are purchasing real or personal property, it is up to you to verify that the seller has a legitimate title to the property you are buying. If they do, the right to possess the property will transferred to you with a deed.

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Is there a difference between a warranty deed and a quitclaim deed?

Yes, there is a huge difference between the two. A warranty deed is one where the person granting the deed (selling the property) agrees to defend the title from the claims of others. In effect, the seller is stating that they fully own the property and they are so sure there are no other outstanding claims against the property that they will "warranty" their ownership.

On the other hand, a quitclaim deed conveys only the rights the seller has. This type of deed transfers the owner's (seller's) interest to a buyer, but does not guarantee that there are no other claims against the property, or even that the property is indeed legally owned by the seller.

If you are buying a piece of property, insist that the current owner (seller) provide you with a warranty deed or its equivalent.

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I'm buying a dishwasher, what should I look for in a warranty?

Warranties on equipment will vary just like the price and the features of the equipment itself. When evaluating warranties on any piece of equipment, make sure you consider the following;

1. How long is the warranty?

2. When does the warranty begin?

3. Will it include the charges for the parts and/or labor to make the repairs?

4. What parts of the purchase are covered by the warranty?

5. Can you lose the warranty if you do not follow manufactures guidelines for routine service and maintenance; and who can perform these tasks?

6. Where is authorized service performed?

7. Who pays to deliver the defective product to the repair area?

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I own a small sports bar and I play CD's and the radio for my background music. Legally, do I have to pay music royalties to anyone?

Until recently, the answer would have been yes. Federal copyright laws state that playing copyrighted music in a public place constitutes a performance. When copyrighted music is performed in public, hospitality managers are in violation of the law if they do not pay the royalties due the owners of the music that has been played. Of course, it would be extremely difficult for the practicing hospitality manager to know exactly who owns the rights to a particular piece of music. Either Broadcast Music, Inc. (BMI), or the American Society of Composers, Authors, and Publishers (ASCAP) licenses most of the songs played in the United States.

However, Congress has determined that any facility that plays its background music on a piece of equipment that could normally be found in a home will not be held to the normal copyright infringement rules if they do not charge admission to hear the music. In 1998, President Clinton signed the "Fairness in Music Licensing Amendment," a law which allowed small restaurants an exemption from some licensing fees. The law took effect in January of 1999. The specific provisions of the legislation provide for the free broadcast of music and video in specific situations. Restaurants under 3,750 square feet can play as many televisions and radios as they desire without paying royalty fees. There is no restriction on the size of the television that may be installed in a restaurant of this size.

For restaurants larger than 3,750 square feet, if the owner applies for and receives an exemption, they may play up to four televisions (no more than one per room), and use up to six speakers (no more than four per room). The television sets cannot be larger than 55 inches.

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What do I have to supply to the Internal Revenue Service?

Our first answer to this was "everything!" Seriously though, in the hospitality industry, managers interact with the IRS because of the manager's role as both a taxpayer (by paying income tax on the profits of a business) and a tax collector for the Federal government (by withholding individual employee taxes on income). The IRS requires businesses to:

· File quarterly income tax returns and make payments on the profits earned from business operations (Form 941). Taxes must be filed on or before the last day of the month following the end of each calendar quarter.

· File an Income and Tax Statement with the Social Security administration on or before the last day of February (Form W-3).

· Withhold income taxes from the wages of all employees (as specified in Circular E). Withheld employee taxes are deposited with the IRS at regular intervals (Form 8109). Employee withholding taxes must be paid quarterly if the total amount of withheld tax for the period is less than $500; once a month if the total amount of withheld tax is between $500 and $3,000; or within three working days of a payroll issuance, if the withheld amount is greater than $3,000.

· Report all employee income earned as tips (Form 8027), and withhold taxes on the tipped income.

· Record the value of meals charged to employees when the meals are considered a portion of an employee's income.

· Record all payments to independent contractors and file forms listing those payments (Forms 1096 and 1099).

· Furnish a record of withheld taxes to all employees on or before January 31 (Form W-2), and maintain copies of this record for four years.

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What is a MSDS? Why are they important?

MSDS stands for "Material Safety Data Sheet."

A MSDS is a manufacturer's statement about the potential hazards and proper methods of using a chemical or toxic substance. The MSDS is intended to inform workers about the hazards of the materials they work with so that they can protect themselves and respond to emergency situations. The law states that employees must have access to MSDS's and be assisted to read and understand them. OSHA inspectors are responsible for insuring that MSDS's are placed in areas accessible to workers.

A MSDS includes:

1. The material's identity, including its chemical and common names;

2. Hazardous ingredients (even in parts as small as 1%);

3. Cancer-causing ingredients (even in parts as small as 0.1%);

4. List of physical and chemical hazards (stability, reactivity) and characteristics (flammable, explosive, corrosive, etc.);

5. List of health hazards, including:

a. Acute effects such as burns or unconsciousness, which occur immediately

b. Chronic effects such as allergic sensitization, skin problems, or respiratory disease, which build up over a period of time;

6. If the material is listed as a carcinogen;

7. Limits to which a worker can be exposed, specific target organs likely to sustain damage, and medical problems that can be aggravated by exposure;

8. Precautions and safety equipment and emergency and first aid procedures;

9. Specific fire fighting information;

10. Precautions for safe handling and use, including personal hygiene; and

11. Identity of the organization responsible for creating the MSDS, date of issue, and emergency phone number.

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What is the EEOC responsible for enforcing?

The Equal Employment Opportunity Commission (EEOC) was established by Title VII of the Civil Rights Act of 1964 and began operating on July 2, 1965. Essentially, this agency enforces laws against discrimination in employment. The following areas fall under the jurisdiction of the EEOC:

· sexual harassment

· race / color discrimination

· age discrimination

· national origin discrimination

· pregnancy discrimination

· religious discrimination

· portions of the Americans with Disabilities Act.

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What do I need to consider before I buy business liability insurance?

Actually, quite a few things. But, since your liability insurance protects you against risk at an agreed upon price, the following five items are really the most important when you compare insurers and the policies they offer.

1. What risks you are insuring against?

2. What is the amount of coverage you will receive?

3. What, if any, exceptions to your coverage are written into your policy?

4. How much will your insurance cost?

5. How sure are you that the insurance company is financially sound enough to pay you if it becomes necessary?

Number five is more important than most people think. Don't forget it. Good luck!

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I know I need Dram Shop (liquor) liability insurance, but what exactly should it cover?

Your liquor liability insurance should provide your establishment with coverage for bodily injury or property damage that can result from any or all of the following acts:

1. Causing or contributing to the intoxication of a person;

2. Furnishing alcoholic beverages to a person under the legal drinking age;

3. Furnishing alcohol to an intoxicated person; and

4. Violating any statute, ordinance, or regulation relating to the sale, gift, distribution, or use of alcoholic beverages.

Serving alcoholic beverages in today's society makes hospitality manager's subject to great risk. In today's legal environment, dram shop insurance is a wise investment.

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What does COBRA stand for? What is it?

COBRA is the acronym for the "Consolidated Omnibus Budget Reconciliation Act," passed by the Federal government in 1986.

COBRA requires employers to continue health, dental, and optical coverage benefits to employees who have resigned or been terminated, and to family members of employees who have lost their health insurance due to death, divorce, or dropping out of school. COBRA participants may continue their benefits for up to eighteen months following the loss of their insurance, although they are responsible for paying the entire cost of their premiums.

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What is the WARN Act. Is my hotel covered by it?

WARN is the acronym for the "Worker Adjustment and Retraining Notification Act." WARN provides protection to workers, their families, and communities by requiring employers to provide notification 60 calendar days in advance of plant closings and mass layoffs. A covered plant closing occurs when a facility or operating unit is shut down for more than 6 months, or when 50 or more employees lose their jobs during any 30-day period at the single site of employment. For example, consider the case of a hotel, employing 150 people, that is purchased by new owners on June 1. On June 2, the new owners announce that all employees will be terminated from employment by the old owners, and re-hired by the new. Employees will be subject to review before re-hiring. In such a circumstance, the WARN Act would allow any employees who prefer not to work for the new company the time required to secure other employment.

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What is a BFOQ? Do any still exist?

BFOQ is the acronym for a "Bona Fide Occupational Qualification." A BFOQ is a characteristic a potential employee must possess to be considered a viable candidate for a job. They exist, and they allow an employer to be very specific about whom they will hire.

The dictionary defines discrimination as the act of differentiating, or separating due to specific characteristics. Employers are free to select specific characteristics of their new employees. They are not of course, allowed to discriminate on the basis of a characteristic specifically protected by law, for example the characteristics of race or religion, because these characteristics do not affect job performance. Where job performance is affected, however, BFOQs protect the worker, employer, and in many cases, even the general public.

Some BFOQs include:

· Physical attributes necessary to complete the duties of the job, such as the ability to lift a specific amount of weight

· Education

· Certifications

· Registrations

· Licensing

· Language skills

· Knowledge of equipment operation

· Previous experience

· Minimum age requirements (for serving alcohol or working certain hours)

To establish that an employee characteristic is, in fact, a bona fide occupational qualification, you must prove that a class of employees would be unable to perform the job safely or adequately and that the bona fide occupational qualification is reasonably necessary to the operation of the business.

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Can I ask potential employees if they have a history of drug abuse or if they have ever been treated for drug addiction?

No, it may seem odd, but you cannot. With the passage of the Americans with Disabilities Act (ADA) the way employers can select employees has changed. Questions on job applications and during interviews that cannot be asked include:

1. Have you ever been hospitalized?

2. Are you taking prescription drugs?

3. Have you ever been treated for drug addiction or alcoholism?

4. Have you ever filed a workers' compensation insurance claim?

5. Do you have any physical defects, disabilities or impairments that may affect your performance in the position for which you are applying/interviewing?

Remember, even with the passage of the ADA, an employer does not have to hire a disabled applicant who is not qualified to do a job. The employer can still select the most qualified candidate, provided that no applicant was eliminated from consideration because of his or her qualified disability. If drug use by potential employees is a concern for you, you are certainly free to implement a pre-employment drug-screening program. More and more operators are using such programs, and with good results. Be sure to get the employees consent prior to arranging for such testing.

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I have one bartender (out of eight) who rarely makes enough tips to cover the tip credit I take on all my bartenders' hourly wages. Do I have to make up the difference?

Yes, most likely you do. First, make sure that individual is in fact declaring all of his or her tips. If they are, remember that the Fair Labor Standards Act (FLSA) defines a tipped employee as one whose monthly tips exceed the minimum established by the Wage and Hour Division of the Department of Labor. Tips received by such employees may be counted as wages up to 50 percent of the minimum wage. The Wage and Hour Division also determines the minimum cash wage that employers must pay to tipped employees. If an employee's hourly tip earnings (averaged weekly) added to this hourly wage do not equal the minimum wage, the employer is responsible for paying the balance. Do the averaging, (contact the FLSA if you need help with the computation) and then you will know if there is a shortfall you must make up.

If you do owe the employee, you need to pay them or face difficulty from the FLSA. Increase this individual's training in guest relations. You'll probably save money in the long run.

Employers may require an employee to work more than 40 hours per week. However, under the Fair Labor Standards Act (FLSA), covered employees must be paid at least one and one-half times their regular rates of pay for all hours worked in excess of 40 in a workweek.

Some employees are exempt from the overtime provision of the FLSA. These include salaried professional, administrative, or executive employees, and employees of amusement and recreational facilitates open less than 7 months of the year as well as employees not subject to the minimum wage.

In the hospitality industry, managers are exempt from the requirements of overtime pay if:

1. The manager is paid over $250 per week.

2. The manager's primary duty is managing the business, or a definable subdivision of the business, in which he or she is employed

3. The manager customarily and regularly directs the work of two or more full time employees or their part-time equivalent.

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I'm familiar with W-2's, of course, but what is a W-5?

A W-5 is a form used by the Internal Revenue Service. It relates to the Earned Income Credit (EIC). The EIC is a refundable tax credit for workers whose incomes fall below established levels. The credit increases for families with two or more children, for families with a child under one year old, and for families that pay for health insurance for their children. Most workers entitled to the EIC choose to claim the credit when they file their federal income taxes. However, employees who elect to submit a Form W-5 (Earned Income Credit Advance Payment Certificate) have the option of getting the money in advance by receiving part of the credit in each paycheck.

Employers are required to include the EIC in the paycheck of any employee who submits a W-5, but are not required to verify the worker's eligibility for the credit. The extra money for EIC payments does not come from the employer, but rather is deducted from the income and payroll tax dollars they would normally be required to deposit with the IRS.

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How many steps should be included in a progressive discipline program?

There is no one answer, but many organizations use the five steps listed below.

1. Verbal warning

In this first step, the employee is reminded/informed of the workplace rule and its importance. The employee is clearly told what constitutes a violation, and how to avoid these violations in the future.

2. Documented verbal warning

In step two, the supervisor makes a written record of the verbal reprimand and both the supervisor and employee sign the document. A copy is given to the employee, and one copy is retained in the employee's file.

3. Written warning

An official, written reprimand is the third step, generally accompanied by a plan for stopping the unwanted behavior and a setting forth of consequences if the behavior is not stopped. This document is placed in the employee's file.

4. Suspension

In this step, the employee is placed on paid or unpaid leave for a length of time designated by management. A record of the suspension, its length and conditions, is placed in the employee's file.

5. Termination

As a last option, the employee is terminated for continued and willful disregard of the workplace rule.

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I know hospitality manager's have a "duty of care" to their guests, but what does that mean?

Simply put, a duty of care is a legally recognized obligation to protect someone or something against harm or damage. While hospitality operators are not considered to be insurers of their guests' safety, and are generally not held liable for events they could not reasonably foresee, they are required to act prudently and use reasonable care, to fulfill their duties of care. Serving food safely is, for example, a duty of care managers owe their guests. Guests, (and employees as well) have a legally recognized right to expect that the food they purchase from a restaurant is safe, wholesome, and is served in a manner that will not cause harm to them.

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What is a "standard of care?" Is it the same for all hospitality managers?

A standard of care is the industry-recognized, reasonably accepted level of care used in fulfilling a duty to guests. Many disputes involving liability and negligence in the hospitality industry revolve around the question of what an appropriate standard of care should be. Like the law itself, these standards are constantly evolving.

Generally speaking, hospitality managers are required to apply the same level of care as any other reasonable hospitality manager in a similar situation. Because standards are constantly changing, and because the standard of care you apply may be assessed during litigation by people who are not familiar with you or your operation it can be difficult to be sure you applying the appropriate standard of care. Because that is true, you have to work hard to keep up with changing laws and society's expectations of you and your operation.

No, standards of care are not the same for every hospitality manager. An appropriate standard of care is determined, in part, on the level of services a guest would reasonably expect to find in a hospitality facility. For example, a guest departing on a seven-day cruise of the Pacific Ocean would reasonably expect that the ship's staff would include a full-time doctor. The same guest visiting a quick service restaurant in a downtown area at 11:00 p.m. would not expect to find a doctor on hand. In both cases, it is possible that a guest could suffer a heart attack and require medical care. The ship's standard of care, however, would include medical treatment, while the restaurant in this case would not.

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Can you define "reasonable care?"

Well, we can try. It is a simple concept, but whether or not it was used in a given situation is the stuff lawsuits are made of! Essentially, reasonable care is the amount of care that a reasonably prudent person would use in a similar situation. The doctrine of reasonable care places a significant burden on you as a hospitality manager. It requires that you use all of your skill and experience to operate your facility in a manner that would be consistent with that of a reasonable hospitality manager in a similar set of circumstances. It's just one more reason to keep up with changing industry standards and guest expectations.

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What is encroachment, and how does that relate to an impact study?

Encroachment exists when a facility has established a market, then a second facility is built that results in a diluting of business in the first facility. Encroachment can happen, for example, when one pizza restaurant opens across the street from another. That's just healthy competition, and happens every day. It is a different matter, however, if the two pizza restaurants are franchisees from the same franchisor.

Franchisors desire growth, and franchisees desire profitable units. While these two interests often coincide, sometimes they do not. In general, franchise impact studies (a study performed to determine if encroachment will indeed be significant if a new facility is constructed) are performed by the franchisor. Not surprisingly, they often find that significant encroachment will not take place if they (the franchisor) allow another facility to be built close to the first franchisee's unit. Because of this, many in the industry question the fairness of impact studies when they are performed in this manner. An unscrupulous franchisor may attempt to make the case that no damage will result from granting competing franchises in a given area, simply to maximize their own short-term revenue from franchise fees.

The best impact studies are performed by an independent third party.

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Maybe. Franchise agreements often strongly favor franchisors in the sale of franchises. This makes sense when you realize that it is the franchisor must live with the new owner.

You need to review the portion of your franchise agreement that relates to selling your business. If, after doing so, you believe your franchisor is over-stepping their rights, contact a qualified attorney who specializes in franchisor/franchisee relationships.

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Are franchise fees negotiable?

Yes, in many cases they are. Because franchisors are generally in a stronger bargaining position than the franchisee, the franchise agreement is often heavily weighted in favor of the franchisor. However, like any contract, the franchise agreement is a negotiable document. Up-front fees or application fees, monthly royalties, areas of protection, required purchases, or renovations to facilities are all areas that are often negotiated prior to signing the franchise agreement. This is especially true with start-up franchise companies, but applies to any franchisor. If you don't feel knowledgeable enough about franchise contracts to do this negotiation on your own, seek a professional to help.

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Businesses operating within similar categories or professions often organize trade associations to pursue common interests. These may include lobbying on behalf of the association members, developing and implementing advertising campaigns for the general industry, helping to establish governing standards for the industry, creating and disseminating codes of ethics, and facilitating the exchange of information as well as carrying out continuing education programs on behalf of the members. But, associations are not immune from violations of the Sherman Anti-Trust Act and anything that can be considered price fixing or a restraint of trade by the association will be actionable.

You are right to be concerned about violating the anti-trust laws. The penalties for doing so can be severe. The Sherman Anti-Trust Act, passed in 1890, is one of the governments most significant tools to help maintain a competitive economy.

Your concern is most likely that allegations of horizontal price fixing could occur if the members of the association begin to internally exchange their pricing practices.

In Section 1 of the Sherman Anti-Trust Act, it states clearly that horizontal price fixing agreements (with the term "agreement" being defined broadly) is a per se (on its face or inherent) violation. Accordingly, this type of activity is illegal.

An alternative approach is to have third party research organizations, e.g. accounting firms, colleges and universities, consultants, etc. do the surveys in an anonymous fashion so that the individual members are not participating as a group in the exchange and gathering of the pricing information. Then the information should only be used as benchmarks rather than collective pricing strategies.

The website www.ftc.gov/ftc/antitrust.htm provides more information on the anti-trust issue.

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As an employer, is it legal to impose a "good credit or no hire " policy, particularly if I get a signed waiver for a credit check at the time of hire?

Yes. You can require a credit report, and you will not be violating the law if you decide not to hire the person because of a bad report.

A bad credit report may mean that an employee is more likely to steal, embezzle or abuse his or her position. Obtaining an authorization from the employee prior to running the credit check is highly recommended. In the signed waiver, among other important provisions, you should add language stating that the credit report will be made available to the employee.

You would be well advised to hire an attorney who specializes in employment law to assist you with the preparation of the waiver form.

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Cameras are touchy because they can rarely keep an incident from occurring (even if monitored) but people argue that they give the guest a false sense of security so they let their guard down. A camera does appear to deter crime because the odds are greater that the actor will get caught (assuming that they know the camera is there). If you are using the camera to monitor the pool area while it is open and to insure that no one uses it while it is closed, those are good practices. Hope this helps.

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Assuming that the employee is currently certified, and applies the procedure properly, then the hotel should be shielded under your states Good Samaritan law. Check with your local or state association for a copy of the law in your area.

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I have formed a partnership with two others to perform general repairs for individual homeowners. What are the legal and tax requirements in order to operate this business?

There are a number of steps to meet the legal requirements, plus a couple of additional programs that, while not required by law, are necessary for a business such as yours. First, let's consider the legal requirements:

1. Since the business is a partnership, you must register for a fictitious name (dba, short for "doing business as") for the business. A dba is required when more than one person owns a business that is not a corporation or a limited liability company. Obtaining a dba can be done at your county clerk's office, and must be done in every county where you plan to operate.

2. The city of Houston and the surrounding counties require business operators to obtain various licenses and permits to comply with local regulations.

The number and type of licenses and permits may vary depending on the type of business involved.

Generally speaking, business -license departments operate as tax-collecting bureaus and do not perform any type of service. You simply pay a fee to operate your business in the area of their jurisdiction.

Further, if you are planning to operate the business out of a residence, you will need to make certain that the neighborhood does not have deed restrictions that prohibit such activity.

3. If you plan to have a sign advertising the business, you will need to get a sign permit.

4. To determine which licenses and permits are going to apply to your business, you can contact the city of Houston One Stop Business Center and it will advise you for both the city and Harris County.

5. In Harris County, the Harris County Appraisal District requires you to register the business and pay a fee based on the value of the personal property owned by the business. If you are doing business in other counties, check with the county clerk there to see if such a requirement exists in that jurisdiction.

Other legal requirements involve state and federal agencies and cover areas such as the following:

· State sales tax: Contact the state comptroller's office and determine if sales tax must be collected.

· Employee work practices/limitations: The Texas Workforce Commission will supply rules and regulations regarding hours of work, type of work and duration of assignment for your workers.

· Employing only legal workers: You must have completed and keep on file a Federal Form I-9 for every employee, including the partners, proving that they have a legal right to be employed in the United States.

· Federal taxes: The Internal Revenue Service will provide assistance in a number of important areas. The business must obtain a Federal EIN number (Form SS-4) and necessary forms and instructions on how to report the earnings of the partnership and instructions on how to compute payroll earnings and tax deductions and complete W-2 forms on each employee.

6. Two key issues, not required by law but very important to your type of business, are insurance and bonding.

To ensure you have the proper type and amount of coverage will require the assistance of an insurance agent who has experience in dealing with businesses.

Further, bonding of all employees should be considered.

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Why would I need an outside security consultant or investigator? (Question provided by Pinkerton Consulting & Investigations.)

Outside security consultants and investigators are most frequently used for the same reasons that you call in outside help with any service or facility problem. You have a challenge that you don't normally deal with, or you have a one-time project or program start-up for which you are not staffed. Full-time staff members are normally engaged for problems and programs you deal with on a regular basis.

Exceptions to this are when individual sites or entire chains outsource certain security operations to security consulting and investigation companies. Investigators are often contracted for pre-employment background investigations, on-going undercover investigations at differing sites throughout a chain or periodically at one site, or for periodic or ongoing audits of in-house security operations, just as security guard companies are often contracted to provide visible protection of guests, employees, visitors and assets. Security consultants may be contracted to provide on-going risk assessments on one or more properties or for Company travelers, maintenance and response for crisis management plans, or for on-going security training of the staff.

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For what purposes might I use security consultants and investigators? (Question provided by Pinkerton Consulting & Investigations.)

Security consultants are used to help and advise you regarding set-up and maintenance of security programs and procedures. They should assess the risk to your operation from all relevant sources and make specific recommendations to avoid or deter these risks. Adopting a qualified security consultant's recommendations may result in a reduction of insurance premiums of certain types, and should always reduce the likelihood of becoming involved in litigation. In all cases, Consultants should clearly present their findings and justify any recommendations made, and all recommendations should be sufficiently specific for you to understand what needs to be done and determine how much that action will cost, and how much it will save. Specific areas where consultants are often used are the following:

· Premises Security - general protective measures for guests, visitors, employees and the property of each, as well as Company property. These may include the formulation of local or national policies and specific procedures in terms of access control hardware and procedures, property patrols, security architecture, guest education and awareness, employee selection and training, common use area security, and relations with local law enforcement, to name a few. Consultants may also be used to audit current security operations and discover flaws or lapses in these operations and make recommendations for improvement.

· Loss Control - plans for deterrence, detection and prevention of theft, fraud, and misappropriation of Company property. This may involve review of physical and financial controls, theft detection hardware and software, and internal and external procedures.

· Workplace Violence - measures to deter, detect and respond to violence or threats of violence in the workplace. A qualified consultant can help you design a complete program to control violence that might be perpetrated by employees, guests, vendors, or anyone else with a relationship to your business. This should include training to recognize the precursors of violence, identification of resources to deal with potential violence and a plan to manage any incidents of threats of violence or violent actions, to include post-incident counseling and resumption of normal activities.

· Assessment of Risk - monitoring the changing risks in unstable locations. In areas that suffer from political, economic or social instability, it is often necessary to constantly monitor risks for both those that are located there and for those that travel to that location, and adjust security measures accordingly. These services are usually accompanied by recommendations for change in procedures, active liaison with local security forces, and plans and advice regarding temporary evacuation or cessation of business.

Investigators are used to help resolve specific problems. These may be anything from avoidance of negligent hiring and retention liability or premises security liability to control of loss. In all cases, investigators' tactics and procedures should be completely legal and above board, and reports should be timely and clearly understandable. All evidence of wrongdoing should be properly preserved and usable in court, in case you decide to prosecute criminals. Common uses of investigators in the hospitality industry are the following:

· Potential Employee Reliability Screening - The foundation for avoiding security problems in the workplace is hiring honest and worthwhile employees. Investigators con help you by conducting background screening of potential hires to detect prior criminal misconduct; excessive civil litigation, especially against past employers; bad driving records; problems with previous employers; and validity of any occupational or professional licenses or minimum education required for the job.

· Suspect and Witness Interviews - Investigators may overtly investigate suspected or alleged employee wrongdoing and interview suspects and witnesses prior to calling the police or taking adverse personnel action. This may be preferable to calling the police right away in some cases. Private investigators may be able to disprove allegations, or collect valuable evidence to support allegations, whereas overburdened police departments generally take your report and deal with your problem as their priorities allow.

· Incident or Accident Investigation - Incidents of violence or accidents wherein guests or employees are injured often leads to litigation; however, the litigation may not occur for months or even years afterward. Investigators are often called in to thoroughly investigate and document the circumstances and preserve any evidence of exculpatory value to the hospitality provider. Investigations of this nature are exclusively done for and reports provided exclusively to the Hotel's legal counsel.

· Integrity Shopping - With or without evidence or allegations of loss, investigators are often engaged to shop restaurants, bars, or other retail operations of hospitality providers to gather evidence of theft or fraud.

· Undercover Operations - Investigators masquerading as permanent or temporary employees can put the employer on notice of employee attitudes and informal, improper procedures; collect evidence of theft, fraud, or misuse of Company property; and investigate sexual harassment, drug use and trafficking, or unsafe procedures.

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How do I select a security consultant or investigator? (Question provided by Pinkerton Consulting & Investigations.)

1. Use a consultant or investigator or a consulting and investigations firm that is well known and has experience in the area of your concerns. Ask others in your industry who they use.

2. Meet the consultant(s) or investigator (s) before you assign any work, ensure you can establish rapport, and explain clearly the objectives.

3. Require a written plan of action of the consultant(s) or investigator(s), so you will know what is to be done and how it is to be accomplished.

4. Request to see the individual's and firm's occupational license, if one is required in your state.

5. If the individual or firm is not well known or no occupational license id required, ask for references for work done in the area of your concern, and check them. Ask the consultant or investigator for a resume and confirm his or her bona fides.

6. Require a written agreement setting forth the terms and conditions of work, a description of the work to be done, and the fees and billing arrangements. If you don't, the consultant or investigator may do just about anything and charge you just about anything.

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We employ a number of Muslim employees who pray five times a day. These employees pray for only a short period three times during their shifts. Am I required to give them breaks from work so they can pray? (Question provided by Krupin O'Brien LLC - www.krupinobrien.com.)

Both Title VII and the Job Training Partnership Act require an employer to reasonably accommodate an employee's or job applicant's religious practices unless the employer can demonstrate that making such an accommodation would cause undue burden or hardship on the conducting of its business operations. So the answer is "yes", you may be required to provide these employees break period so that they may pray. However, if providing these breaks causes a substantial disruption to your operations, then you would have grounds to deny them these breaks.

The question really becomes what is "reasonable"? The answer varies with each case. In most instances, any accommodation by an employer which attempts to address the employee's religious requirements is sufficient. In making a determination on what kind of accommodation to offer, an employer must conduct a thorough exploration of the alternatives that would meet the employee's religious needs and determining, based on the facts, whether any of the options could be implemented without an undue disruption to the business operations. When one or more different options exist, an employer has the option of choosing the accommodation which poses the least hardship on its operations.

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The Equal Employment Opportunity Commission (EEOC) has recently concluded that an employee health plan violates the Pregnancy Discrimination Act (PDA), if the cost of prescription contraceptive drugs are excluded as a covered benefit by the plan, but preventive drugs, devices, and medical procedures, such as Viagra and surgical sterilization for men, are covered.

Enacted by Congress in 1978, the PDA requires equal treatment of women affected by pregnancy, childbirth, or pregnancy-related medical or disability conditions in all employment practices, including fringe benefits. It protects women from discrimination because they have the ability to become pregnant-not just when they are already pregnant. Because the PDA prohibits discrimination against women, the EEOC has determined that it necessarily covers a health plan's exclusion of prescription contraceptives since they are a means by which a woman may control precisely that ability to become pregnant. The PDA does not require that all employers provide a contraceptives to employees. However, it does require that the health plan provides the same coverage for prescription contraceptives as for other drugs, devices, or services used to prevent the occurrence of medical conditions other than pregnancy.

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An employer will not violate the FLSA if it docks an exempt employee's pay in hourly increments for time taken off due to intermittent Family and Medical Leave Act (FMLA) leave. However, in such a situation, if the employer fails to give the employee notice that the leave is protected under the FMLA, then any leave taken would NOT constitute leave covered under the FMLA and the employer would be in violation of the FLSA if it deducted from the employee's pay in hourly increments.

Similarly, if an eligible employee has used up the 12 weeks of FMLA leave per year to which he or she is entitled, then any other leave taken in addition to the 12 weeks does NOT constitute FMLA leave. Consequently, if an employer deducts from an employee's paycheck in hourly increments after the employee has already exhausted his or her FMLA leave, such deduction would violate the FLSA.

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The Age Discrimination Employment Act (ADEA) bars discrimination on the basis of age in connection with employee benefits. However, it does permit employers to provide lower life, health, and disability benefits to older workers if the employers pay an equal amount to provide those benefits to each employee. The Equal Employment opportunity Commission (EEOC) has issued some new guidance to help employees determine whether a particular benefits program is nondiscriminatory.

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Title VII of the 1964 Civil Rights Act prohibits discrimination based on religion. Religion is broadly defined as "all aspects of religious observance and practice," which may include broadcasted religious services. When an employee's religion conflicts with a job requirement, the employer must consider whether the employee's religious practice can be reasonably accommodated without undue hardship.

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He does not have a valid claim under federal law. Title VII of the Civil Rights Act of 1964 (Title VII) prohibits employment discrimination and harassment based upon an employee's sex. Title VII does not, however, prohibit discrimination based upon an employee's sexual orientation or sexual preference. The phrase "based on sex" in Title VII means that it is unlawful for an employer to discriminate against or harass an employee because the employee is a woman or because the employee is a man. In other words, Congress intended the term "sex" to mean "biological male" or "biological female," and does not refer to an employee's sexual orientation or sexuality.

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You are wise to proceed cautiously in this matter. Federal law does prohibit retaliation against employees who oppose discriminatory employment practices or participate in proceedings related to a formal charge of discrimination filed with the EEOC. However, a recent decision by a federal appeals court supports employers who wish to punish such conduct. In that decision, the court ruled that an employer with a good faith belief that an employee lied during an internal investigation could lawfully fire the employee on that basis.

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No. The Americans with Disabilities Act (ADA) strictly limits an employer's ability to make disability-related inquiries prior to making an offer of employment. As a general rule, an employer may not ask a job applicant any disability-related questions or require any medical examinations prior to an offer of employment even if the questions are related to the job. After an offer of employment is made, an employer may only seek information about an employee's medical condition when it has a reasonable belief, based on objective evidence, that: (1) the applicant will be unable to perform the essential functions of the job because of a medical condition; or (2) the applicant will pose a direct threat because of the medical condition.

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Although not a per se violation of anti-discrimination laws, questions concerning children and child care may be seen as discriminatory toward women, especially when combined with other comments regarding gender. In a recent case, a federal court of appeals held that questions concerning a female employee's child bearing plans, along with other evidence of a discriminatory attitude toward women, were sufficient to establish a basic case of discrimination. In that case, in addition to inquiring about the employee's plans to have children, the vice president of the company also made remarks about the employee's ability to handle family responsibilities and work commitments.

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Under current law, presentation of an unrestricted Social Security Card by an employee who previously presented an Employment Authorization Card is sufficient for reverification purposes.

Under U.S. Immigration and Naturalization Service (INS) regulations, employers are required to "reverify" the employment authorization of every employee who indicates on his or her I-9 form that his or her employment authorization will expire. Such reverification must occur no later than the date the individual's work authorization expires. Pursuant to INS regulations, reverification is completed by having the individual in question present either a document which shows continuing employment eligibility, such as an unrestricted social security card, or a grant of new employment authorization.

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The Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code (IRC) permit employers to exclude independent contractors from participation in employee benefit plans. However, if a worker can prove that he was misclassified as an independent contractor and is in fact an employee, he may be retroactively entitled to benefits made available to his employee counterparts.

As a general rule, independent contractors are individuals with specific skills who are hired to perform a project which is beyond the company's "core business". These individuals typically maintain discretion over the performance of their tasks and are not subject to day-to-day control. In determining whether an independent contractor is actually an employee, the courts generally examine a list of factors relating to the terms and conditions under which the person works. Your company should consider such factors as whether this individual is integrated into the workforce, whether the person shares the same supervisors with employees, whether the person performs identical or substantially similar job functions, the location of this work and the number and types of hours worked, to determine the proper status.

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In general, neither state or federal child labor laws address whether parental consent is required to drug test a minor, nor do drug testing laws. However, as a general rule, minors lack the capacity to agree to medical procedures and prior to any such procedure, parental consent is required. Parents of a child under the age of 18 generally have the authority to make decisions regarding medical treatment for the child. Therefore, employers should obtain the consent of both the minor and his or her parent or guardian before requiring the minor to take a preemployment drug test. All other requirements for drug testing in your particular state must still be observed. As is the case with any other applicant, if the minor and/or his or her parent or guardian refuse to consent, the employer may choose not to hire the minor.

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In a case before the New Jersey Supreme Court in which an employee filed a sexual harassment claim, the court ruled that critical and insulting postings on a work-related electronic bulletin board could be grounds for workplace harassment. The court found that although the electronic bulletin board may not have a physical location within the employer's facility, it may nonetheless have been so closely related to the workplace environment and beneficial to the employer that continuation of harassment in that forum should be regarded as part of the workplace. Accordingly, if the employer had notice that co-employees were engaged on such a work-related forum, in a pattern of harassment directed at a co-employee, the employer would have a duty to remedy that harassment.

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Replacing an older employee with a recent college graduate based on the assumption that the younger individual is more computer literate is prohibited by the Age Discrimination in Employment Act (ADEA) and similar state laws. However, you may certainly terminate any employee lacking computer skills if his or her position requires them, and you may hire a younger person to fill that job if the individual has the necessary skills.

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No. Although you can adopt a policy requiring that employees speak English at certain times or when engaged in certain activities, a blanket rule prohibiting employees from speaking a foreign language at any time can be deemed to be discriminatory and can subject your company to liability.

According to guidance from the Equal Employment Opportunity Commission (EEOC), a rule requiring employees to speak English at all times can disadvantage an individual's employment opportunities on the basis of national origin. The EEOC also believes such a rule may create an atmosphere of inferiority, isolation and intimidation based on national origin which could result in a discriminatory work environment. The EEOC has stated that it will presume such a rule violates Title VII.

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The Pregnancy Discrimination Act (PDA) is part of Title VII of the 1964 Civil Rights Act. The PDA requires employers to treat women affected by pregnancy, childbirth, or related medical conditions in the same manner as it treats other employees who are similar in their ability or inability to work. This means that an employer who fires an employee for excessive absences, even those related to the employee's pregnancy, does not violate the PDA so long as it treats the absences of non-pregnant employees in the same way. The PDA does not require employers to make special concessions to pregnant women if it does not make such concessions to other employees. The key is whether the pregnant employee is treated the same as a non-pregnant employee with similar performance issues.

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Probably not. The Americans with Disabilities Act (ADA), prohibits employers from discriminating against an employee on the basis of a disability. A disability under the ADA is defined as either: (1) a physical or mental impairment that substantially limits one or more of an individual's major life activities; (2) a record of such impairment; or (3) being regarded as having such an impairment. If an employee's impairment does not rise to the level of a disability under the ADA, then the employee is not protected, even if the employer terminated her employment solely because of her impaired condition.

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For I-9 verification purposes, certain types of receipts are acceptable. Employers may accept receipts for List A, B, or C documents that evidence an application for a replacement document when the original document was stolen, damaged or lost. After 90 days have passed from the date of initial hire, however, the employee must present the replacement document he or she applied for or some other valid document to satisfy the verification process. Where a receipt is presented in reverification situations, the employee must present the replacement document or some other valid document for verification purposes within 90 days of the expiration of the initial work authorization.

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Under the Immigration Reform and Control Act of 1986 (IRCA), all new employees, even those hired for only one day, must undergo I-9 verification. This includes all individuals put on the employer's payroll to whom a W-2 tax statement is issued. Persons referred by labor unions or recruiters must undergo I-9 verification procedures, because the union or recruiter is not required to undertake such procedures prior to referral. However, persons referred by a state employment service need not undergo I-9 verification if the state service has already conducted the procedure, in which case the state should notify the employer that it has done so.

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The short answer is not yet. First, you should ascertain whether the employee's tardiness is caused by her depression. However, such inquiries must be made without violating the Americans with Disabilities Act (ADA). In addition, employers generally are required to provide reasonable accommodation only when requested by an employee. It is likely that these issues can be clarified in a discussion between the employee and her supervisor.

The ADA prohibits discrimination against qualified individuals with disabilities and requires an employer to provide reasonable accommodations to help disabled employees perform their jobs. However, at this point, it is not clear whether the employee's tardiness is related to her disability. To resolve this question, a supervisor should discuss the problem with her and ask why it is occurring. However, the supervisor must refrain from asking about the employee's medical condition or disability; the discussion initially must focus solely on the employee's attendance issue.

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The Worker Adjustment and Retraining Notification (WARN) Act requires that employers give their workers written notice at least 60 days in advance of a mass layoff or plant closing. A company is covered by the Act if it employs 100 or more full-time employees, or 100 or more employees who collectively work at least 4,000 hours a week. Under the Act, the sixty-day notice requirement is triggered when an employer's proposed plant closing or layoff affects either (1) more than 500 employees, or (2) fifty or more employees if the number of employees affected is at least thirty-three percent of the employee's total workforce.

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Although caution is required any time you ask an individual to waive legal rights, when obtaining a release under the Age Discrimination in Employment Act (ADEA), additional steps must be taken. These steps are outlined in the Older Workers Benefit Protection Act (OWBPA), a federal law that protects employees who waive age discrimination claims.

For an employee's waiver of ADEA rights to be effective, the waiver must specifically state that ADEA claims are being released, and must be part of a written agreement that is drafted in plain English so that the average person can understand it. An employer may not ask workers to waive ADEA claims arising after the date that the waiver is executed, and the company must provide some compensation or benefit in exchange for the waiver that the employee is not already entitled. The agreement also must advise the employee to consult with an attorney before signing.

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Dating between co-workers is not illegal, even where one employee supervises the other. However, an employer may adopt policies regulating or prohibiting workplace dating, and more and more companies are doing so to avoid uncomfortable office situations and to minimize potential liability. Some employers prohibit dating between supervisors and any employees who report to them, while others go farther and ban workplace dating altogether.

Consensual workplace dating, without more, does not constitute sexual harassment. However, the EEOC takes the position that where a subordinate feels coerced to enter or continue a relationship with a supervisor, the subordinate may have a valid harassment claim, and other workers who lost out on opportunities because the subordinate was preferred over them may also have a claim. Workplace dating also can lead indirectly to harassment claims and can negatively impact workplace morale.

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What is my duty when a guest comes in and requests that their real name not appear on any paperwork or records?

For documents involved in payment of the room, such as a credit card sales ticket, obviously using a false name would not be an option. Additionally, it is important to maintain an official and accurate guest registry for several reasons: 1) Some local ordinances require a hotel to keep a register of guests, and if the hotel did not do so accurately, it could be participating in a fraudulent scheme; 2) If law enforcement were to subpoena guest records, the hotel would need to be able to produce an accurate listing; and 3) Emergency situations may necessitate having an accurate official guest registry. As long as a hotel keeps an official register, it could agree not to list a person as a guest on their phone list or for other inquiry purposes. The hotel would want to ensure that all relevant employees were aware of the situation and protocol. A problem could arise if the hotel promised to provide this guest service, and then failed to fulfill the promise. The hotel would set itself up for a legal claim on a breached promise or obligation that it was not required to make in the first place.

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Do you have a form or some "wording" for a patron who is injured on your property, but insists that they do no want/need to receive medical treatment at the nearby emergency room, wh