During the early days of the pandemic, we talked to industry attorney Greg Duff about the potential legal ramifications of COVID on the hospitality industry. Nearly six months later, has any of that changed? Let’s go back to Duff, chair of Foster Garvey’s hospitality, travel, and tourism practice, who recently presented four “Legal Headlines or Headwinds for Digital Marketers” during HSMAI’s virtual Chief Digital Officer Executive Roundtable:
COVID COMMUNICATIONS: ‘Why Am I Subject to This?’
When I talk about communications, it’s a review of all of the ways in which you touch your guests. It could be as simple as the website, a confirmatory email, or any other form of guest communication. It’s making sure that in those communications, you are taking advantage of those opportunities to communicate important changes that may be in place because of COVID.
These communications tend to fall into two categories, the first being practices and policies — whether it be a mandatory mask requirement, social distancing, mandatory health screening or questionnaires upon arrival, elevator policies, and so on. The other category involves informing guests what changes may have occurred on property, such as a restaurant that is operating at reduced hours or a pool that is closed.
The challenge here goes back to the very first client call about COVID that we received back in March. In that instance, we had an operator who called and said, “My owner is concerned about COVID. His insurance broker is reporting that it’s not covered. The owner wants to require all of our guests to sign a waiver at check-in.” Well, that conversation then led to a much broader conversation: How do we balance the fact that, on the one hand, you as an operator have now made public all of these wonderful things around your clean, safe, secure environment; and then, on the other hand, a guest who may have selected your property because of that campaign is being handed a piece of paper that says, “Oh, by the way, you may contract COVID and die, and you cannot hold us responsible”?
Typically, our recommendation is, when you go to the website, whether it be the property site or the company site, start with a broad general disclaimer: “As you know, we are undertaking various measures that may change frequently. They may include this or that. For more information, feel free to call the property.” As your communications get closer to the guest’s arrival, focus the message on the policies and practices you expect to be in place and the amenities currently closed or curtailed.
This is one area where we encourage clients to rely on the authorities. Whether it be the CDC, the U.S. Department of Health and Human Services, state and local health departments, or even the American Hotel & Lodging Association, let them be your guide. If you want to take broader and more affirmative steps, that’s fine. But at least if guests start raising questions or asking, “Why am I subject to this or that policy?,” it’s nice to have that backstop.
WEBSITE ACCESSIBILITY: ‘The Failure to Provide Information’
The first six months of 2020 saw a 15-percent reduction in website accessibility cases being filed. I think we all know why that’s the case: Many courts were just closed for weeks or months during the early onset of the pandemic. Those that were likely to file probably withheld and chose to delay. It will be interesting to see how the second half of 2020 compares, because we may have a flood of people rushing to the courthouse to file or not. Eighty percent of the website accessibility cases that have been filed have been filed in three states: California, New York, and Florida.
Most settlements provide the hotelier some period of time to become compliant that ranges between 12 and 24 months. Most settlements also include some kind of payment to the plaintiff as well as some kind of ongoing compliance program. Even if your website becomes fully compliant in 12 months, there is usually some commitment by the hotelier that it will go back and review the website policy and any guidelines that may be there, and ensure that the website remains compliant going forward.
Most of the newer cases that we’re seeing are focusing on the failure to provide information about accessible guest rooms and accessible public spaces in common areas. It’s not so much about the accessibility of the website and the use of the website; instead, plaintiff’s attorneys are focusing on the content that’s on the website and whether that is satisfying ADA standards.
A number of cases have also now been brought against hoteliers alleging that their third-party distribution partners failed to provide adequate information. You may think that shouldn’t be your responsibility, that should be the third party’s responsibility, but unfortunately, the Department of Justice has taken the position that owners and operators are primarily responsible for the display of their rooms. It’s something to think about in your next OTA conversation.
DISTRIBUTION: ‘A Gatekeeper, Consolidator, and Aggregator’
Let’s start with Booking.com, which among the many distributors appears to be one of the most active during this pandemic period. By “active,” I mean they appear to still be proactively pursuing new contracts and exploring new initiatives with their supplier partners. By now, many of you are probably familiar with Booking.com’s proposal to facilitate guest payments on hotels’ behalf. There’s still some debate about the pros and cons of this program. If you are considering the facilitated payments option, I would encourage you to read the fine print carefully.
Expedia Partner Solutions [EPS], as many of you know, was part of a much-publicized deal with Marriott last fall. The effects of that transaction are now starting to be seen. For example, Expedia has recently begun to aggressively promote to its business partners the availability of deeply discounted Marriott B2B rates through EPS.
Not surprisingly some of the wholesalers or redistributors that stood to be hurt by that Marriott agreement — Hotelbeds being a good example — are now heavily promoting their own solution to hotel partners whereby the wholesaler can serve as a gatekeeper, consolidator, and aggregator of wholesale inventory and rates. I bring all this up simply to say that there’s a lot of movement today in the wholesale distribution world and considerations around whether to consolidate that distribution with a central figure, like an EPS or Hotelbeds.
And finally, last week, Amazon announced the launch of Amazon Explore. It has been launched for beta-testing only here in the U.S., and it’s marketing and providing a platform for the sale of virtual experiences. Now, you might think this is a knee-jerk reaction to the pandemic, but in fact, the groundwork for this offering has been going on now for close to a year, long before the pandemic commenced. Many that are looking at this new offering are speculating that if Amazon can figure out how to deal with activities and experiences virtually, it will be very easy for Amazon to one day flip the switch and make them actual experiences. Then, once Amazon masters experiences, how much more difficult will it be to add hotels, airlines, etc.? So, for those of you that are following the mystery of Amazon and when it will recommit to travel, many feel that last week’s launch of this new platform is further evidence that they do intend to pursue travel.
CARES ACT: ‘The Requirements Are Quite Burdensome’
When many of you hear of the CARES Act, you’re probably thinking about PPP [Paycheck Protection Program] loans. That was what we all first heard about in the hospitality industry when the CARES Act was initially passed. What I’m talking about is a different aspect of the CARES Act that relates to the Coronavirus Relief Fund, which was a $150-billion fund that was created to issue grants to state and local governments. Some of these funds now are making their way into tourism in an effort by state and local governments to either stabilize or promote the return of travel, lodging, and hospitality.
The concern here is that by participating in a tourism campaign that involves CARES Act funding, you can become bound by the many federal requirements associated with this funding. The requirements are quite burdensome. Whether you choose to receive these funds directly or indirectly as a subcontractor to a recipient, you can be subject to these requirements.