Keeping the workplace safe from violent incidents requires hospitality employers to be able to identify warning signs and risk factors. But the work starts before that; it starts with the hiring and employee monitoring processes.

Before And After You Hire: Internal Threats Of Violence

Internal threats of workplace violence require separate considerations from external threats. Preventing internal threats of violence generally requires a focus on pre-employment screening, employee monitoring, and effective employee training. Hospitality managers can think about this as occurring in two phases: before the hire and after the hire.

Before You Hire

An important time to begin taking measures to prevent and minimize workplace violence is during the hiring process. Effective pre-employment screening can help you avoid hiring employees with “red-flag” behavior. Some steps that hospitality employers can take to avoid future instances of workplace violence include:

1. Criminal history and background checks. You are permitted to conduct criminal history and background checks for job applicants. While federal law prohibits the use of this information in ways that would discriminate against or disparately affect protected classes (e.g., race and national origin), you can use previous convictions, and sometimes arrests, as a screening tool, on a case-by-case basis, where such convictions may relate to an essential job requirement. With the level of daily customer contact present in the hospitality industry, properly conducted criminal history screenings, particularly where there is a history of violent crime, can work to prevent future incidents of workplace violence. Note, however, that state and local laws often govern the use of background checks by employers, so you should consult with legal counsel on best practices for implementing this screening tool.
2. Social media. There are currently no federal laws that prevent you from monitoring the social media activity of prospective and current employees. Despite valid privacy concerns and the potential for bias, the social media accounts of both potential and current employees can provide a wealth of information for employers. In the hospitality industry, a large majority of the employees are millennials who are often more comfortable portraying their true thoughts through a computer screen. Through these sites, you may possibly learn of the potential violent predispositions that job applicants may have. A job applicant’s social media presence can demonstrate to you whether warning signs like fascination with violence, for instance, are present. This applies equally to current employees.

It is important to note, however, that the use of social medial as a pre-employment screening tool or a monitoring device for current workers comes with a number of potential pitfalls that you must work diligently to avoid. A potential employee’s social media can also alert employers to information such as the employee’s race, religion, gender, disability, sexual orientation, pregnancy status, etc., none of which can be taken account in the decision to hire an applicant. Moreover, a current employee’s social media feed might reveal private information you might not want to know for fear that your knowledge could be used against you in a later discrimination or retaliation claim. Therefore, you should consult with legal counsel before deciding to implement any sort of social media screening.

After You Hire

Because warning signs of future workplace violence are not always apparent before you hire, you must still take steps to monitor their current employees for potential signs. In the stressful environment of the hospitality industry, it does not take much for a simple disagreement between line cooks in the kitchen to turn into knives being pulled against a coworker. A few tips for employers:

1. You should implement and maintain an effective workplace violence plan. This plan will contain outright bans on certain “trigger” behavior such as harassment, fighting, threatening, and bullying—and outline the discipline for such behavior. The plan may also contain a ban on employees carrying weapons on your premises as well. The plan should provide conflict resolution tips and strategies for employees to use to deescalate a stressful situation.
2. You should train employees on how to identify and report “suspicious behavior,” some of which can include a fascination with violence, excessive verbal threats to other employees or against restaurant patrons, substance or alcohol abuse, obvious indicators of mental instability, or a history of poor impulse control or violence. In training employees on how to identify and report suspicious behavior, you should also have an effective procedure for handling employees that have been reported:
   1. First, management needs to take all threats seriously;
   2. Where the reports are of internal conflicts, harassment, or bullying, you need to work quickly to understand the root of the conflict and diffuse it; and
   3. You should discipline as appropriate in order to clearly demonstrate that any such violent behavior will not be tolerated.
3. Employee training should also include training on conflict resolution between other employees in the workplace. Effective conflict resolution training is necessary to aid employees in immediately deescalating situations that may arise in the workplace. Importantly, these skills can also be used when dealing with the public. In training employees on how to effectively manage conflict and deescalate potential acts of violence, you should adopt the following training guidelines:
   1. Where tempers are running high, it is best to separate the employees and give them space to calm down;
   2. It is important to understand what the nature of the conflict is;
   3. Extreme care should be taken not to pass blame or take sides; and
   4. Management should be informed about the situation as soon as practicable.

The high rate of turnover in the hospitality industry presents an added layer of responsibility as it relates to dealing with internal threats of violence, because you must ensure that your new employees are constantly being trained. As such, you should consider implementing both a new-hire training schedule, as well as periodic refresher trainings.

When It Is Out Of Your Control: External Threats Of Violence

Because hospitality employers welcome the public, monitoring external threats of violence is extremely important. It only takes one angry customer or even a random criminal act to result in serious incidents of workplace violence. Some best practice tips:

1. Just like you have a fire evacuation plan, you should also have plans for other emergencies like active shooters, robberies, or other violent workplace incidents. For instance, your staff should know where to go, who is responsible for contacting emergency services, and where the emergency equipment (e.g., first aid kits) are located. A comprehensive workplace plan is a useful tool in making such designations. Ideally, a workplace plan should contain a procedure for employees to follow in the event of an incident of violence and should identify a designated manager or other responsible employee who will coordinate evacuation or other employee safety efforts, and initiate or maintain contact with law enforcement.
2. Many hospitality businesses operate at late hours, so it is important to structure employee shifts in order to avoid employees closing alone or working in isolated areas late into the night.
3. As with internal threats of violence, it is also important to train employees on effective conflict resolution and deescalating incidents between employees and the patrons, or among patrons. While factors such as whether alcohol is served or not may play a role in how extensively employees should be trained, it is advisable to have at least some level of conflict resolution training.
4. Hospitality operations, like other cash-heavy businesses, are also targets for robbers. You need to keep this in mind and train your employees to be cognizant of how they handle cash in front of customers and other members of the public. Employees also need to be trained on who to contact in case of criminal attacks, and how to behave during attempted robberies in order to deescalate the situation.
5. Where financially practicable, you should consider investing in onsite, visible security. This could include visible security cameras but can go as far as security guards. Having such visible security can serve as a major deterrent for both internal and external acts of workplace violence. Even where it is not financially practicable to make such security investments, you should still consider having this kind of visible security on special occasions where the risk of violence may be heightened—e.g., Super Bowl Sunday, St. Patrick’s Day, New Year’s Eve, etc.

Conclusion

It is important to note that some instances of workplace violence cannot be reasonably foreseen or prevented, mostly due to the unpredictability of human nature. While careful background screenings, social media review, and even putting in place effective policies and procedures for times of violent incidents will go a long way to minimize the occurrence and impact of these incidents, they cannot prevent against some of the recent incidents of workplace violence covered by the media. Regardless, you have steps you can take to prevent and minimize the impact of incidents that may be within your control.

Because several legal issues may arise with an employer’s decision to both implement effective pre-employment screening tools and construct workplace violence plans, you should consult with legal counsel as you develop these procedures. If you need assistance with how to implement best practices to combat workplace violence, contact your Fisher Phillips attorney.

For more information, contact the author at CEnekwa@fisherphillips.com or 404.231.1400.

About Fisher Phillips
Employers often must take a stand: in court, with employees and unions, or with competitors. Fisher Phillips has the experience and resolve to back up management. That’s why some of the savviest employers come to the firm to handle their toughest labor and employment cases.Whether it’s a class action involving thousands of potential class members, a jury trial with exposure in the millions, or a union organizing effort or strike that could cripple a company, employers with their choice of employment lawyers choose Fisher Phillips to handle their most difficult and dangerous cases.

According to the US Centers for Disease Control and Prevention (CDC), more than 50 percent of international travelers become ill during their trips to developing countries; some of these illnesses are preventable. Many people are unaware of their vaccine status or new vaccines that have recently been developed. Lacking cognizance of either factor can put individuals at risk when they set out for their international travel.

Travel Risks and Immunizations
A person who is vulnerable to a vaccine-preventable disease runs the risk of transmitting it to another vulnerable person when entering a new area. It’s imperative that travelers research which vaccines are recommended or mandatory prior to traveling. In 2018, it is expected that pockets of diseases such as measles, mumps, pertussis, and diphtheria will emerge in areas where these diseases had seen previous control.

The recommended immunizations for all global travelers are as follows:

• Diptheria, Tetanus, Pertussis
• Influenza
• Measles, Mumps, Rubella
• Pneumococcal Disease
• Hepatitis A and B
• Varicella

Depending on your destination, health authorities may recommend other vaccines, in addition to the above list. Keep in mind that some recommended vaccines require multiple doses administered over time; pre-travel planning is imperative. Scheduling a pre-travel consultation with a medical professional who understands the vaccination rate and current trends in outbreaks can help prevent the inadvertent spread of diseases.

2018 Health Trends to Watch
In the first few months of 2018, health authorities have noted a marked increase in the global number of measles cases. Even areas with traditionally high vaccination rates have seen some communities experience declining immunization in the past several decades due to religious reasons or misinformation about vaccine safety. This trend of declining vaccination rates is alarming, as areas that had seen nearly complete eradication of measles are experiencing outbreaks once again. The cost for direct and indirect illness care, care for sick children, lost productivity, and disease-associated complications can be substantial. Travelers should know their immunization status to prevent becoming victims during an unexpected outbreak of measles or other vaccine-preventable diseases.

Vaccinations are important to protect individual human capital, as well as for broader, continued corporate productivity. Organizations can facilitate getting appropriate immunizations by identifying in advance those who are slated to travel and getting them to the proper healthcare professional to ensure they receive appropriate vaccinations. Finally, check with the CDC and/or state department for information on required vaccines and documentation before traveling abroad.

To stay up to date on health trends and threats around the globe, iJET’s Intel Central Health Intelligence subscription provides up-to-date trends on infectious disease and other concerns, as well as location-based health information and disease fact sheets.

Hotel safety protocols

Scene I

Exterior: London, England. Upscale major branded hotel. End of the year.

Interior: A conference is being set up.

Most of the conference is ready to go; we just need to email the hotel and request they present some safety and security measures for our conference attendees at the beginning of the conference. The hotel owner agrees but suggests sending this information to the guests prior to arriving for the conference. We rapidly agree and are shown some of the most thorough policies and procedures we have ever seen. The attendees greatly appreciate having this information pre-conference.

End scene I.

Scene II

Exterior: Convention Destination City, USA. Upscale major branded hotel managed by a third party. End of the year.

Interior: A conference is being set up.

Before the conference prep is complete, we speak to the owner about presenting safety and security protocols for the hotel at the beginning of the conference. We were advised that the hotel did not have such protocols in place and, in fact, that this information had never been requested by a meeting planner before.

End scene II.

As amazed as we were with the information provided by the London Hotel, we were just as dumbfounded by the response of the U.S. hotel. Given the challenging safety and security climate today, every hotel needs safety and security protocols that it is willing to share with conference hosts and attendees. Just as importantly, meeting planners need to request the information be provided to their attendees.

We are not suggesting that a hotel share its internal security response systems or all of its security methods. Hotels should be sharing just what the attendees, who are unfamiliar with the property, need to know so they can respond quickly in case of an incident at the property. This information includes emergency exit locations, safe rooms in the occurrence of a natural disaster and how to dial emergency services from the in-room phone.

As an aside to this, just as meeting planners and corporate travel buyers are ramping up their vetting of hotels from a safety and security perspective, hotels should be vetting the conference prior to entering an agreement to host the event.

Your hotel, employees and guests all benefit from strategically crafted incidence response protocols. We encourage quick development of these procedures before an incident happens.

Authors

Paige Tidwell – Marketing & Social Media Assistant, HospitalityLawyer.com

Paige Tidwell is a junior at the University of Houston, Conrad Hilton College of Hotel and Restaurant Management. She is seeking a Bachelor of Science in Hotel & Restaurant Management with an emphasis in Sales & Marketing. In addition to working for HospitalityLawyer.com, Paige works as a teaching assistant for two professors at the Hilton College where she works with students of all levels. Raised in both Baton Rouge, Louisiana and Houston, Texas, Paige naturally developed a passion for food and people. Her interest in hospitality was cultivated at a young age when she and her dad would cook for their church groups. In her free time, Paige enjoys trying new places to eat with friends and going to the gym.

Stephen Barth – Founder, HospitalityLawyer.com

Stephen Barth, author of Hospitality Law and coauthor of Restaurant Law Basics, is an attorney, the founder of HospitalityLawyer.com, the annual Hospitality Law Conference series, and the Global Travel Risk Summit Series. As a professor at the Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston, he teaches courses in hospitality law and leadership. In addition to legal and risk management insight, Stephen specializes in communicating the importance of Emotional Intelligence in leadership roles; and has provided valuable insight to many companies including The Methodist Hospital System, Best Western Hotels & Resorts, Dine Equity, Business Travel News and Aramark. His fun, fast paced presentations provide practical information and solutions to enhance your personal and professional life.

The details of the horrific Mandalay Bay attack offer a clear example to the hospitality industry as to just why proactive – and often covert – security standards must be tested and implemented.  The name of the game is to detect, deter or neutralize an attack before it takes place. In order to do this, smart technology and keen intelligence gathering techniques must be deployed. Well-versed analytical personnel must have unfettered access to the intelligence and offer management their professional assessment as to the threat at hand.

We note here some of the suggestions we have provided in recent conversations with hotel security personnel or in hospitality sector security associations or meetings.  If implemented, these revised or updated protocols could further enhance security for guests and employees. But to be effective, they each must be studied by the hotel operator, assessed for potential legal challenges and training must be provided to employees.

Again, with the emphasis on being proactive and getting out in front of potential threats, consider the following measures:

• Ensure your hotel security personnel participate in any local or regional periodic security meetings with their peers from other hotel chains.  That is a great way to share intelligence on criminal or extremist trends affecting the tourism sector and hotels in particular. Even though a particular crime trend may not have reached your geographic area or if it is affecting only brands that do not reflect your  demographic, you still need to be aware of it and prepare for it. And don’t keep the intel to yourself-your staff needs to be aware and that includes employees at the worker-bee level.

• Ensure to provide meaningful and recurrent training to staff with frequent guest interface regarding possible indicators of suspicious activity.  Probably the most important line of defense here is the housekeeping staff, which enters guest rooms on a daily basis, often more than once. Staff should be trained to recognize the signs of potentially unsafe or illegal activity, such as telltale signs of human trafficking or prostitution.  The accumulation of several unmarked boxes, bags or suitcases inconsistent with the number of guests assigned to the room is something noteworthy as well. Any unusual or foul odor or the presence of an unknown substance in any area of the room should trigger a notification to security personnel.  Again, we are reminded of the saying “see something, say something”.

• Room entry when the “do not disturb” sign hangs on the outside of the guest room should not be interpreted as a mandate not to enter.  Each hotel operator will have to establish its own policy with regard to periodic staff entry and as to how long is too long before a knock or a call from the front desk is made.  Entry policy should be closely coordinated with the hotel’s legal counsel.*

*Key Point:  Consider adding a waiver or consent clause to your guest registration paperwork in which the room occupant specifically agrees to periodic entry by hotel staff to ensure the safety of all guests and employees.

• A clear “know your customer” policy should be established.  In other words, hotel security staff or employees at the operator’s corporate headquarters need to implement a cursory background check of certain arriving guests who may seem out of place in the establishment.  For example, if you are welcoming a 20 year old man or woman into your hotel and if the room is in the $400-$500 per night category, you may want to do a “Google” check or similar check on the name. The person has done nothing wrong so far and possibly never will, but in general, a 20 year old does not fit the demographic of a hotel charging that amount of money per night.  You may find nothing, but you may find that the person has had a series of run-ins with the law. That of course does not necessarily mean he or she should be excluded from the premises, but it’s a nice heads up to the staff.
  

• The use of check-in/check-out apps has to be the most frustrating technology out there for hotel security personnel.  It allows the guest to have virtually no interface with the hotel staff in that check in and out is performed electronically and billing is automatically charged to the credit card on file.  Room entry is achieved with a downloaded code or barcode, which the guest holds in proximity to a reader made a part of the exterior door lock. If you use this technology at your hotel, ensure that you DO have interface with the guest during his or her stay by knocking on the door occasionally or by placing calls to the room.

There are many other proactive ways to enhance security at hotels and large venues.  Various technologies are commercially available which permit iris scanning or facial recognition.  Of course, with the adoption of new techniques, some privacy is given up. Individual brands and properties will determine the right mix for their locations, based on customer demographics, prior incidents, crime and terrorism trends and importantly, the law.  Privacy cannot and should not be total in a hotel as guest and employee security and safety must be taken into consideration.

What Is Virtual Kidnapping?

In a virtual kidnapping, the criminals make a ransom demand, without actually taking a hostage; rather, the perpetrators negotiate with those from whom the ransom is demanded on the pretext that a connected person has been abducted. Virtual kidnapping can take on many forms; however, it is always an extortion scheme which attempts to coerce victims into paying a ransom fee in exchange for the release of a family member/associate. Criminals typically employ a host of psychological tactics and threaten physical harm to ensure the victim’s compliance. These forms of kidnapping do not require the geographical proximity or resources of traditional kidnapping – for- ransoms such as accomplices, resources, safe houses and capital outlay. Virtual kidnapping has a high risk-benefit ratio in favor of criminals, offering high returns against a low risk of capture or prosecution.

Virtual Kidnapping- Techniques and Methods

Techniques and methods used by criminals to perpetrate virtual kidnappings vary and continue to evolve. A perpetrator will call the victim and convince them to isolate themselves in a specific location out of their family’s reach or to travel to a location of the perpetrators choice, through the use of coercion techniques. Once there, the victim is made explicitly aware of his/her abduction and is held against his/her will by the assumption that they will be harmed, should they escape. Often victims are threatened to switch off their mobile devices, contact no one, which further creates the illusion that they (the victim) has been kidnapped, making the rouse more convincing. These more sophisticated forms of virtual kidnapping require some amount of coordination on the part of the criminal, who may need to do some preliminary investigations prior to initiating the scheme and selecting a potential victim. Criminals often impersonate cartel members as a means of intimidating their victims or lead their victims into believing that they are under surveillance in order to discourage them from trying to contact the abductee or to notify the authorities.

In one of the more common forms of virtual kidnapping, victims are selected at random and criminals use telemarketing techniques and cold-call hundreds of numbers until someone submits. When this technique is employed, criminals may call their victim and mimic screaming or play recorded versions of screaming while threatening to harm their “captive”, often inducing panic. In this state, the victim may instinctively reveal the name of one of their relatives, thus enabling the criminal to gain information directly from the victim while undertaking the extortion. Criminals involved in virtual kidnapping schemes tend to pursue the ‘mass market’, increasing their range of targets and the threat to individuals significantly. Unlike traditional kidnap for ransom, victim profiles vary and are not dependent upon geographical location, language, race or socio-economic factors.

Recent Incident

On Feb. 2, a federal grand jury in Houston, Texas, returned a 13-count indictment against Mexican national, Ismael Brito Ramirez, relating to virtual kidnapping scheme run in several states involving at least 40 victims. The perpetrator, currently incarcerated in Mexico on other charges, is believed to have called various individuals in California, Texas, and Idaho demanding ransom payments on the premise that he had abducted their relatives. The perpetrator threatened violence before instructing his victims to transfer undisclosed sums of money to a number of people in Mexico or to make money drops at specific locations in Houston, TX. Ramirez extorted in excess of USD 28,000 from his victims and has been charged with conspiracy to commit extortion and fraud, interstate transmission of extortionate communications, wire fraud and conspiracy to launder money. 

Virtual Kidnapping Characteristics

Criminals tend to demand wire payments smaller than $2,000 (or the equivalent thereof) within the US to Mexico as there are legal restrictions for wiring larger sums over the border. Occasionally, criminals direct victims to make money drops at locations of their choice within the US, such as San Diego or Houston, which can be smuggled across the border with relative ease. Within Mexico, ransom amounts may vary, depending on the modus operandi employed by the criminal. Criminals typically seek to extort small payments within 24-hours of initiating the extortion; incidents rarely continue beyond a few hours.

Cyber Threat

There is an electronic or cyber risk when considering virtual kidnappings. Malware, spyware or trojans may be used to make an electronic device run an unintended program that allows criminals to gain private or secure information from their intended victim. Phishing scams aim to trick individuals into disclosing private information, such as their social media passwords, to criminals. Phishing scams are usually delivered in the form of official communication from a reputable institution such as a bank or internet service provider. Criminals may convince would-be victims to reset their passwords by delivering an ‘official’ email to the user, thus gaining access to their current passwords. Criminals may also contact the victim informing them that necessary updates need to be made to their mobile software and that their devices would need to be shut down for an extended period of time, rendering the victim uncontactable.

Social media is another aspect when considering potential cyber threats. Sharing personal information online could make you vulnerable to criminals. Social engineering in virtual kidnapping ranges from simple tactics to more sophisticated techniques.  Opportunistic criminals may monitor your current whereabouts online and use it in their extortion scheme. An example of this includes posting your upcoming activities online, such as your intention to watch a film at a local theatre – the virtual kidnapper knows their potential victim’s phone is likely to be off for two hours during movie and may use this time to extort their family members as the intended target may be uncontactable for that time period. More sophisticated tactics involve befriending people on social media to learn more about their habits, wealth or personal life as a means of surveillance. Cybercrime methods have been increasingly employed by criminals when perpetrating virtual kidnappings. This trend is likely to gain momentum as the technical abilities of unsophisticated criminal groups and networks grow.

Statistics and Reporting

Comprehensive statistics on virtual kidnappings are difficult to ascertain for a number of reasons. As many criminals perpetrate these crimes from within Mexico, it is increasingly difficult for US-based law enforcement agencies to investigate and prosecute cases. Ransom money is often wired out of the US, making it challenging to trace. Law enforcement agencies are usually limited to their national jurisdiction or may lack the capacity, skills, and mandate to investigate transnational criminal activity fully.  The poor reporting rate remains a significant challenge in tracking and assessing incidents and trends. In the US, victims may not report incidents out of fear of being targeted again or being stigmatized. Sometimes victims do not report incidents because the payment extorted was nominal and not considered significant enough to report. In Mexico, victims are often unwilling or unable to report incidents due to fears of reprisals and/or concerns over official corruption, collusion or incompetence.

Virtual kidnappings are not formally classified under the penal code. In the US for example, there is a Federal Kidnapping Act, which in most cases classifies traditional kidnapping as a federal offense. Charges of aggravated kidnapping may be laid in the event that the victim has sustained injuries. However, there is no specific act under which a crime of this nature can be charged. Rather, virtual kidnapping-related charges are laid under the federal criminal code. Charges may include conspiracy to commit fraud, wire fraud, extortion, money laundering or a combination of the aforementioned charges, further exacerbating the challenges around collecting conclusive incident data. Although there are obvious challenges related to gathering accurate statistics and incident data relating to virtual kidnapping, a number of alternative methodologies for accessing and processing information may assist in this regard. Anecdotal evidence, unofficial data, and prosecuted cases are good indications of the scale of the threat and have served to posture the position that the trend has and will continue to grow.

Growing Trend

The scam, once confined to Mexico and Southwestern border states in the US, has seemingly spread to the rest of the US in recent years, representing a significant shift in the trend. Investigators in the FBI’s Los Angeles Division tracked numerous virtual kidnapping calls between 2013 and 2015, most of which originated from Mexico, specifically Mexican prisons, and targeted Spanish speaking individuals or immigrant workers within the US, particularly in Los Angeles and Houston. After 2015, trends shifted and criminals targeted victims indiscriminately and far more frequently using the cold-calling method – a tactic which increased the number of victims significantly. Since 2013, the majority of the cases probed by FBI in Mexico have emanated from Tamaulipas and Baja California. Further highlighting this trend, the FBI discovered a virtual kidnapping ring based in Tijuana, Baja California targeting the Mexican immigrant population in Washington DC in 2013. The ring placed in excess of 5,000 phone calls a day, a scheme based solely on volume and the odds of success. The ransom payments were primarily sent to San Diego, California and smuggled across the border. The FBI estimate the group made at least USD 500,000 over an unspecified period of time, further illustrating the nature of the threat.

In Mexico, the poor security environment and pervasive threat of crime and traditional kidnap-for-ransom, has enabled the virtual kidnapping trend to grow amid the insecurity. Potential victims in the US are more likely to take the virtual kidnapping threat seriously and engage the extortionist, as a result of the existing threat of traditional kidnap-for-ransom in Mexico. The National Autonomous University of Mexico (UNAM) reported that between 6,000 and 8,000 virtual kidnappings and phone extortion schemes were reported in Mexico in 2017, further highlighting the scale of the threat.

Risk Mitigation

Indicators that you may be the victim of a virtual kidnapping scheme:

• Callers may attempt to keep you on the phone to prevent you from contacting the victim. Alternatively, callers may threaten you or the supposed hostage in an attempt to discourage you from contacting the victim or the authorities.
• Callers may convey a sense of great urgency or calls may seem rushed.
• Calls will not be made from the victim’s phone.
• Ransom money is only accepted via wire transfer or drop-points.
• Ransom amount demands may suddenly drop.
• Incoming calls may come from an outside or international area code.

For risk mitigation, the following should be considered:

• Be cautious about detailing your whereabouts on social media if you are undertaking travel abroad. Consider updating your social media accounts following your intended trip. Some criminals may research their targets this way.
• Inform your relatives and close confidants if you will be undertaking travel to areas with no/limited cell phone reception or internet connection.
• Stay informed about cybersecurity and how to avoid online threats.
• If you suspect a real kidnapping is taking place, or you believe the call may be a scam, contact your nearest local law enforcement agency as soon as possible.

For further guidance on risk mitigation, iJET clients are eligible for additional information.

Download our 2018 Global Forecast Executive Summaryto get insights into other risks impacting the world today.

As mentioned in that blog, OSHA does not have a specific standard governing workplace violence but incidents may potentially be cited as a violation of the general duty clause.   Typical examples of employment situations that may pose a higher risk of workplace violence incidents include but are not limited to:

1. Duties that involve the exchange of money
2. Delivery of passengers, goods, or services
3. Duties that involve mobile workplace assignments
4. Working with unstable or volatile persons in health care, social service, or criminal justice settings
5. Working alone or in small numbers
6. Working late at night or during early morning hours
7. Working in high-crime areas
8. Duties that involve guarding valuable property or possessions
9. Working in community-based settings
10. Working in a location with uncontrolled public access to the workplace

Some jurisdictions such as New York have enacted legislation requiring public sector employers to develop and implement programs to prevent and minimize workplace violence.  Although the New York law is limited to public sector employers, it can provide all private sector employers a good roadmap on what an effective workplace violence prevention program should include.  Generally speaking, employers should consider:

• Developing and posting a written policy statement about the employer’s workplace violence prevention program goals and objectives
• Conducting a risk evaluation by examining the workplace for potential hazards related to workplace violence
• Developing a workplace violence prevention program that explains how the policy will be implemented which would ideally include details about the risks that were identified in the evaluation and describe how the employer will address such risks. The policy should also include a system to report any incidents of workplace violence similar to a reporting mechanism found in a sexual or other unlawful harassment policy
• Providing training and information for employees including any risk factors and what employees can do to protect themselves
• Documenting workplace violence incidents and maintain those records

In addition to OSHA issues, workplace violence could also expose businesses to liability in other areas such as vicarious liability for worker conduct based on a respondent superior theory, negligent hiring and negligent retention and also have potential workers’ compensation implications.  Of course, the most important issue is simply the health and wellbeing of the employees.

Earlier this year, a Texas teenager, who was the unfortunate victim of human sex trafficking, filed suit in Harris County Texas against several well-known hotel chains as well various truck stop operators and the website “Backpage.com,” which was alleged to advertise and promote illicit sexual encounters. All businesses named were sued under the theory that these entities profited from the illegal sexual exploitation of a minor. This suit, along with a similar lawsuit filed last year in Pennsylvania, provides yet another cautionary tale to the hospitality industrythat the specter of human trafficking at one of its facilities raises significant concerns of civil liability to both the owner and operators of those facilities.

According to the Texas complaint, “Jane Doe,” alleges that she was involuntarily thrust into the shadowy underworld of human trafficking just prior to her 16th birthday. The suit claims that she was instructed by her trafficker to rent a hotel room, or have her exploiter rent a room, using payment methods which did not provide any identification to the hotel, i.e., a pre-paid credit card or cash. Once inside the room, Jane Doe maintains that she was sexually exploited by a “constant flow of male customers.”

Despite the warning signs raised by pre-paid credit card or cash payment, the complaint alleges that hotel management and staff failed to intervene, contact the police or otherwise prevent the sexual exploitation of minors at their properties. Essentially, Jane Doe contends that her continued sexual exploitation was caused when hotel management “turned a blind eye to the plague of human trafficking and the sexual exploitation of minors at their locations.”

Jane Doe filed her complaint utilizing a Texas law which creates liability for individuals or entities that intentionally or knowingly benefit from participating in a human trafficking venture for damages arising from such trafficking. This statute mirrors the federal Victims of Trafficking and Violence and Protection Act (TVPA) which creates civil liability for various entities, including hotels, restaurants, casinos, and bars, which “knowingly” benefit from human trafficking if it can be demonstrated that they knew or should have known about the illegal venture.

Significantly, liability under the TVPA is not restricted to hotels. Rather, as noted above, a trafficking victim may bring an action against “whoever” knowingly benefits from participation in a venture that they knew or should have known involved sex trafficking. Accordingly, businesses such as restaurants, casinos, bars, and nightclubs must take heed of the potential consequences of ignoring the signs of human trafficking.

Lawsuits filed under the TVPA, or a state counterpart, are likely to cause the hospitality industry much consternation and concern simply because of the significant potential monetary exposure and public relations/reputational risk associated with having a brand connected to human trafficking. The question thus becomes: what is a hospitality related business to do in order to properly shield itself from potential liability?

Since the legal standard is whether the business knew or should have known that human trafficking was occurring in connection with its business, it puts the onus on the business to be self-aware of what is occurring on its property. It is, therefore, crucial that a comprehensive and thorough anti-trafficking compliance program be implemented, including but not limited to, training hotel management and people working in specific departments, such as security, housekeeping, and the front desk, to identify and report human trafficking when they suspect that the illegal activity is occurring in their workplace.

One state has already taken action to ensure that businesses in the hospitality industry have a heightened responsibility in self-policing their properties.  In 2016, Connecticut became the first state to pass legislation mandating that all hotel workers receive anti-trafficking training. The training instructs workers on sex and labor trafficking, the legal responsibilities of lodging establishments and practical tools for identifying signs of sex and labor trafficking. The workers also learn how to deter traffickers, report suspected crimes and help victims connect with services. Although Connecticut was the first state to require mandatory training, it is anticipated that it will not be the last. In fact, there is currently a bill before the Florida legislature which would limit the liability for businesses that can demonstrate that they had training and protocols in place to identify trafficking.

The scourge of human trafficking is not going away and will, unfortunately, continue to be synonymous with the hospitality industry.  Accordingly, it is imperative that members of the industry proactively engage in anti-trafficking compliance and training in order to combat exploitation and reduce potential civil liability.

Disclaimer: This post does not offer specific legal advice, nor does it create an attorney-client relationship. You should not reach any legal conclusions based on the information contained in this post without first seeking the advice of counsel.

Joint Employment

A little over a year ago, we wrote about the concept of joint employment and its impact on the retail industry, particularly as it related to franchisors and franchisees. At the time of publication (August 2016), the National Labor Relations Board was taking a very expansive view of the concept of joint employment, meaning more companies could potentially be targets for union elections and collective bargaining by individuals with whom they had no direct employment relationship.

With the advent of the new administration, however, the Department of Labor withdrew the previous guidance and its overly expansive view of joint employment. Congress also began work on a proposed law that would scale back the new standards to a less expansive legal test. Then, in December 2017, the newly constituted National Labor Relations Board overruled a 2015 decision that had expanded the concept of joint employment, returning the analysis to a traditional and reasonable interpretation.

Specifically, the Board held that two different companies would be considered joint employers for purposes of the National Labor Relations Act (NLRA) only when each entity has exercised control over essential employment terms of another entity’s employees (rather than merely having reserved the right to exercise control) and has done so directly and immediately (rather than indirectly) in a manner that is not limited and routine. This was a welcome change for businesses that had operated under these standards for thirty years.

These changes do not, however, signal an end to the joint employment doctrine. To the contrary, even after retreating to the more conservative joint employer standard, the NLRB concluded that the two employers involved in the specific case were joint employers under the narrower standard. Nor do these changes under the NLRA change the law in every arena. Retailers will continue to see plaintiffs in employment lawsuits attempting to add them as defendants under a variety of laws. There is more than just one joint employment standard. Two examples of this doctrine are also found under the Fair Labor Standards Act (FLSA) and Title VII.

Joint Employment Under Wage And Hour Law

The FLSA – the nation’s primary wage and hour law – expressly recognizes the concept of joint employment. The regulations interpreting the Act provide that “a single individual may stand in the relation of an employee to two or more employers at the same time under The Fair Labor Standards Act of 1938 . . . .”  When determining whether two entities are joint employers under the FLSA, courts consider the economic realities of the relationship and apply a multi-factor test known as the “economic realities” test. For the most part, the various economic realities tests rely on the traditional common law test for employment with various economic considerations incorporated.

These economic considerations focus primarily on financial dependency. In other words, courts look to see whether the employee depends on the alleged employer for his economic livelihood based upon the parties’ actual working relationship. Whether or not the parties intended to create a joint employment relationship is irrelevant for purposes of the FLSA.

If a joint employment relationship is found to exist under the FLSA, both employers are responsible for compliance with the Act. For example, if a temporary employment agency supplies an employee to your company but fails to pay proper overtime compensation, the temporary agency and your company could both be held liable for the amount of overtime pay owed to the employee.

Joint Employment Under Discrimination Law

There is no clearly defined standard for determining whether a joint employment relationship exists for the purposes of Title VII, which is the primary federal antidiscrimination law. Nevertheless, for the purpose of Title VII liability, courts treat independent entities as joint employers if they share or co-determine matters that affect the essential terms and conditions of employment. Generally, the key issues examined by courts are whether the alleged employer has the right to hire, supervise, and fire employees.

It is important to note that a joint employment relationship is not always necessary for a finding of joint liability under Title VII. Federal regulations written by the Equal Employment Opportunity Commission (EEOC) provide that an employer may also be responsible for the acts of nonemployees with respect to sexual harassment. The EEOC will consider the employer’s degree of control and other legal responsibility with respect to the conduct of the nonemployee. Thus, regardless of whether an actual joint employment relationship exists, so long as you have some control over a contingent worker, you should take immediate corrective action if you become aware of harassing conduct.

Direct Causes Of Action

Furthermore, there are also employment-related claims that can be brought directly against you by individuals on your worksite who are performing employment duties for another employer. These claims generally arise either from direct interactions between your employees and the vendor’s employees at the worksite, or from communications between you and a vendor concerning employee performance.

Tort claims under state law are the most common source of these liabilities. For example, let’s say a worker loses their job because of negative information you reported to the direct employer. That worker might bring a defamation claim against you. This could easily arise from a situation where you accuse the individual of theft or some other criminal conduct (which could be considered defamation per se). In fact, even if you do not communicate negative information, but simply advise the direct employer that the individual is no longer welcome on your premises, the employee could bring a claim against you for intentional interference with a contract. While the premises for and viability of these claims differ among states, they do provide a means by which nonemployees can seek to punish the company that, in their minds, cost them their jobs.

Individuals may also have claims based on the conduct of one of your employees. For example, if your employee makes derogatory comments to the individual, a claim for intentional infliction of emotional distress could arise, and there is little doubt that the plaintiff’s attorney will name your company as a defendant. While one of the most difficult torts to prove, such allegations can pull your company into costly litigation.

Independent Contractors

Another problem area exists when contracting directly with an individual for services pertaining to functions commonly performed in the business. If your company identifies such an individual as an independent contractor, and therefore makes no withholding from their pay, you may run afoul of tax laws, as well as workers’ compensation, wage and hour, and unemployment insurance laws.

There is no single test for determining independent contractor status. Rather, the definition varies depending on the legal issue and the enforcement agency involved. For instance, you will find different definitions and tests for independent contractors in the IRS Code, the state unemployment insurance codes, federal and state wage hour laws, and state workers’ compensation statutes.

In the retail world, the question of whether to designate an individual as an independent contractor appears most often in situations that call for part-time employees. For example, if your store hires a janitor to clean the store twice a week, one of your managers might assume the individual is an independent contractor because they are not working full time. However, the number of hours an individual works is generally less important than the type of work being performed. Here, cleaning is a task for which most retail employees have some responsibility to oversee, which might categorize that individual as an employee in the eyes of the law. It is much safer to avoid the question by simply classifying the janitor as a part-time employee who is paid on a W-2 hourly basis.

Our Advice

No one can stop an individual from filing suit, no matter how frivolous. So your first step should be to obtain whatever protections are available before a suit is ever filed. If contracting with a company whose employees will be performing work on your premises, it is critical to negotiate for indemnification. While this won’t prevent your company from getting sued, it will put the burden of defense and associated costs on the contracted company.

Next, never sign a contract with a labor agency without a thorough review of the agreement. Oftentimes these contracts are written to assign responsibility to the retailer, indemnifying the labor provider for any event occurring on the premises that gives rise to litigation. Additionally, employment practices liability insurance policies should be reviewed with an eye toward whether they cover employment-related claims made by individuals who are not your direct employees. It’s important for your company to have this coverage.

When contracting for services, another important piece of the puzzle is to make sure the vendor supplies onsite supervision. While it isn’t necessary for these supervisors to be onsite 100 percent of the time, they should be visiting the workplace to check on their employees’ performance and to address any issues with a particular employee.

Once protections are in place, there are internal measures you should address. In-store management must understand that they are not to fill the role of supervisor to the other company’s employees. You need to conduct training identifying the individuals who fall into this category and the necessary procedures to follow for handling problems associated with these individuals. There should also be a stop-and-check mandate before a manager asks to have another company’s employee removed from your premises. While there will certainly be times when an individual’s misconduct means such action is appropriate, supervisors are often unaware of any risk in removing another company’s employee, and therefore act with little thought.

Conclusion

Hiring employees is not easy, and using another company to handle the administrative aspects of hiring can certainly be beneficial. But before traveling this road, you should take stock of where issues might arise and be prepared to address those risks.

For more information, contact the author at EHarold@fisherphillips.com or 504.592.3801.

Security measures protect people and property from threats and dangerous conditions. This protection extends to all parts of the premises which the patron or employee may be reasonably expected to go and to those parts of the premises that the business has reasonably led them to believe they can go. Bars have a responsibility to provide reasonable protection to patrons and employees on the premises.

There are many threats to safety that may occur at a bar. The possibility of death and injury due to fire is an important issue that has to be effectively addressed. Proper policies and procedures should be established for the safe evacuation of all the occupants on the premises. Bars will have a large amount of cash on the premises. Liquor bottles may be stolen. Employees may be assaulted during a robbery or theft of liquor. Bottles and drink glasses could be used as weapons not only during a robbery or theft; but during a fight between patrons or an assault of an employee. In some circumstances, an employee can effectively handle a disruptive patron by using verbal and nonverbal (physical actions and demeanor) skills to diffuse the situation. An effective method is asking a disruptive patron to leave the bar. If the patron refuses, advise the patron that he/she has the opportunity to leave on their own or the police will be contacted to remove them from premises. Employees should be properly trained in the policies and procedures established by the bar to address the aforementioned threats and improper behavior that may occur on the premises.

Assaultive behavior can occur between patrons. Managers, waiters, waitresses, and bartenders may be assaulted by intoxicated or combative patrons. An employee policy should be in place identifying when the police and/or management should be contacted when there are violent or disruptive patrons. If security personnel are on site, the employee policy should identify when security personnel should be contacted.

Consumption of alcoholic beverages by everyone working for the bar during their work hours should be prohibited.

Security Personnel

Bars, taverns, restaurants, and nightclubs are usually the busiest on Thursdays, Fridays, and Saturdays. Most assaults occur on weekend nights. If assaultive behavior is foreseeable on the property, security personnel should be employed. Security personnel in bars are often referred to as bouncers, doormen, and floor men. The role of security personnel is to protect people and property. This responsibility includes patrons and employees.

The hiring, training and supervision of security personnel is an important aspect of providing effective security. One of the best methods of crime prevention is the obvious presence of security personnel. It is essential that security personnel be recognizable and conspicuous.

Proprietary and Contract Security

Security personnel can be proprietary or contracted. Proprietary security personnel, also known as in-house security, are employees controlled by the company that is providing security for its facilities and other property. They receive instruction and supervision from their employer. Contract security personnel are employed by an outside security firm. They provide security services to a business customer, but are managed by the contracted security firm.

Hiring of Security Personnel

Hiring of applicants should take place after a reasonable background check is conducted. This responsibility is one of the most important priorities for security management. The background check often includes requirements identified by a governmental entity. A business’s responsibility to its patrons is to provide effective security through proper hiring practices. The hiring of security applicants is a critical part of establishing and maintaining an effective security force.

Training of Security Personnel

Security personnel should be adequately trained prior to beginning, and continue to be trained once employed. If a security guard is required to be licensed by the city and/or state where he/she works, the security guard should be licensed. The importance of training cannot be overstated.

Adequately trained security personnel are essential to achieve management’s goal for employees to properly perform their duties. What management wants and how management wants it done is reflected in the training of security personnel. Without the proper response of the appropriate employees, the security measures in place are often ineffective with respect to the safety and security of the patrons and employees of a business. Security personnel should know what their responsibilities are and how to properly carry them out. By security personnel being properly trained, their actions will be in compliance to the policies and procedures of the business.

The importance of employees following proper training is essential to a proper response. Security personnel, not assigned to a stationary post, will move throughout the premises and observe patrons for reasonable behavior while they patronize a business establishment. It should be remembered that security personnel have the same rights as a private citizen. When appropriate, reasonable force should be used by security personnel. If two or more patrons are involved in a fight, they should be removed from the premises. An effective method is to eject the more aggressive patron or group of patrons first and wait until they vacate the area of the premises before ejecting the more passive patron or group of patrons.

Monitoring Performance of Security Personnel

The management of security personnel should be delegated to a knowledgeable and competent individual who understands the required safety and security responsibilities of the business. If the security personnel are contracted personnel, there remains a responsibility by the business owner or manager to monitor their performance. This responsibility can include assessment of contract employee performance, response of contractor management to the bar owner’s or manager’s concerns, and training. It is important to ensure the contractor is meeting contractual standards, but direct supervision of contract security should be carried out by the management of the contractor. When there is an issue involving contract security personnel, the bar owner or manager should communicate their concern through the management of the contractor.

The responsibility for supervising security guard performance should be executed by someone who moves throughout the premises. Security personnel should be properly hired, trained and managed. When security personnel’s actions are improper, it may be attributed to inadequate hiring, training, and/or supervision.

An effective strategy of controlling assaultive behavior is to position a security guard/security personnel at bar entrances and exits. This will control access into the building by confirming a patron is the proper age to enter and is in compliance with bar policy for entrance into the building. Additionally, the actions of patrons outside the front door and inside by the front door can be monitored. Crowding around the bar and on the dance floor creates the risk of patrons accidentally bumping into each other. This can lead to fights between patrons. These are areas of the premises which may need to be monitored if assaultive behavior is foreseeable on the property.

Bar security is important for the patrons and employees of the bar. It is essential that all workers on site are properly trained in the policies and procedures of the bar. An effective response to a threat, dangerous condition or improper behavior is required.

In the storms’ aftermath, businesses in the affected areas of Texas, Louisiana, Florida, Puerto Rico and the Virgin Islands should be vigilant in pursuing insurance recoveries. That entails assessing not only the physical damage to their property but also income losses stemming from flooded and blocked roads and bridges, interruptions of shipping and air transport, evacuations, and closures by civil authority.

Businesses suffering from supply chain disruptions, both in the areas of immediate impact and throughout the United States, should look to their property insurance policies for contingent business interruption coverage, triggered when policyholders lose revenue due to the effect of property damage on a supplier or customer.

Business interruption insurance covers businesses for losses in income stemming from unavoidable disruptions to their regular operations as a result of damage to property. In addition to coverage resulting from damage to the policyholder’s own property, “BI” coverage also may be triggered by circumstances including utility service interruption, a government evacuation order or a substantial impairment in access to a business’s premises. Many property policies also provide “extended business interruption” coverage that begins when the property is fully repaired and ends when operations are ramped up to their pre-disaster level—though that extension typically is limited to 60 days.

Contingent business interruption coverage is triggered when policyholders lose revenue after a property loss impacts one or more suppliers or customers. For example, businesses that rely upon specialty chemicals from the affected area may have to pay more for supplies, and companies that sell into the area, such as consumer products manufacturers and distributers, will suffer lost sales. While the business itself need not be physically damaged, it does need to have coverage for the type of damage that affected its suppliers, business partners or customers. For
example, a business must have flood coverage to file a contingent business interruption claim for losses triggered when a supplier is incapacitated by flood.

Whether the policyholder has the appropriate coverage for its own property that is needed to trigger contingent business interruption coverage can be a complicated issue. Many companies have flood insurance only for specifically designated flood zones. If the policyholder has substantial operations outside those zones, an insurance company might argue that it does not have the needed coverage to respond to a contingent business interruption loss stemming from floods in the Gulf or Puerto Rico.

Extra expense coverage applies to additional costs incurred by the policyholder as a result of damage to its property, and to costs incurred to mitigate economic losses. This coverage often is very broadly defined.

Contingent extra expense coverage applies when costs are incurred as a result of a business interruption caused by damage to the property of a supplier or customer. Like ordinary extra expense coverage, contingent extra expense insurance may be issued in one of two basic forms: 1) for extra expense to reduce loss and 2) for “pure” extra expense. The more common coverage insures only against extraordinary costs incurred to minimize or prevent a contingent business interruption loss. For example, following the destruction of a chemical manufacturing plant, a customer’s contingent coverage could be triggered by the need to purchase alternative ingredients at higher prices
than the lost supply.

POLICY PITFALLS: SUBLIMITS AND CONCURRENT CLAUSES

Many commercial property insurance policies provide different sublimits for losses caused by “flood” “storm surge” and “named storms.” How the policy defines these key terms can be critical in determining the amount recoverable for the policyholder’s loss.

In the aftermath of a major storm, damage caused by wind or wind-driven rain, storm surge or flood can be difficult to distinguish. For policyholders lacking flood coverage, insurance companies often invoke “anti-concurrent causation clauses” to deny any coverage at all if flooding occurred. Some state courts, however, have held that if the “efficient proximate cause” of damage is covered—that is the dominant cause—then the claim is covered. Also, anti-concurrent causation clauses should not be applied to property that is damaged by a covered cause, such as wind and rain, and later subjected an excluded cause, such as flood, which causes no additional damage. For this reason it is often important to determine the sequence of events and cause of damage to each item in the property loss claim.

CAREFUL COVERAGE EVALUATION

Calculating the full range of business income loss from property damage, disruption of the surrounding area, and closures by order of civil authority is a complex task. It begins with a careful evaluation of your insurance coverage, taking into account the interplay between the various coverages, exclusions and sublimits which may apply to your claim. Then, develop a plan to drive the claim adjustment to a prompt resolution. In that regard, make clear to the insurance companies the adverse impact that a delay in payment will have on your company, and document everything that occurs—or does not occur—in the adjustment process so the insurers will know that a record is being made of their claims handling conduct.

In the aftermath of disaster, insurance can be a vital lifeline—but it is one that has to be actively seized, and in some cases strenuously climbed. Understanding your full range of coverage and thoroughly documenting your sources of loss are essential to maximizing the recovery owed under your insurance policies.

Authors

Finley Harckham is a senior litigation shareholder in the New York office of Anderson Kill where he regularly represents and advises corporate policyholders and other entities in insurance coverage matters. His areas of particular focus include property loss, business interruption, directors and officers liability, construction, professional liability, aviation liability, cyber and general liability claims.

Marshall Gilinsky is a shareholder in the New York office of Anderson Kill. During his 20-year career representing policyholders, he has recovered hundreds of millions of dollars for his clients, successfully litigating disputed claims under a variety of insurance products, including property and business interruption insurance, commercial general liability insurance, errors and omissions insurance, and directors and officers insurance.