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Local 2 Unite Here Union Leader Mike Casey's reportedly facing problems according to a vast number of sources to this blogger.  Mr. Casey needs to pay better attention to World economic events, and have a better understanding of the dynamics of the hotel business.

The legendary and largely popular Casey's got a problem: hotels need to cut costs in the face of what have been in some cases dramatic revenue declines, even with occupancy improvements. Hotel workers want to keep their jobs, which should mean accepting pay cuts. But Casey, who would have an easier time of it when the economy was better as it was in the early 2000s, is seen by some as standing in the way of a good resolution to the problem of maintaining hotel jobs, let alone San Francisco getting new convention business as well as maintaining existing events.

What Casey and his charges want flies in the face of most of what other workers have realized reasonable agreements on, from the union's website: Affordable, high-quality health care; Modest increases in wages; Modest improvement in pension.

The one outlier is health care, which even some hotel managers agree should be maintained in some effective way; beyond that a "Modest increases in wages" and "Modest improvement in pension" seem like political pipe dreams today, when even some hardline progressives dare talk of the need to cut pensions for public service workers.

This is why Casey's reportedly having a problem in effectively mobilizing his troops this time around.  Membership in the union has decreased 30 percent from 13,000 to 9,000 in three years.  The union's contract with the hotels expired  August 2009.

Hyatt Hotels Fights Back

Casey's efforts have targeted the following hotels: Grand Hyatt, Hilton San Francisco, Hotel Frank, Hotel Metropolis, Hyatt Fisherman's Wharf, Hyatt Regency Embarcadero, Le Meridien, Palace Hotel, Westin St. Francis, and the W Hotel. The union asserts that hotels like the Hyatt have realized occupancy gains; the hotels assert that they're trying to counter rising costs and tightening margins in a still-tight economy.

It's more than occupancy rates, which have increased since 2008, but room rates. While the occupancy rates are better, overall revenues are not and that's due to, in many cases, dramatic decreases in room rates just to capture those occupancy rates.

In this, the Hyatt Hotels fought back, filing National Labor Relation Board (NLRB) charges against Local 2 Unite Here on January 19th 2011, and for allegedly violating the collective bargaining agreement and say the union "quietly diverted money [two cents an hour] from the Child & Elder Fund [to the Legal Fund], without bargaining with Hyatt."

That issue aside, the real matter is in how Mike Casey is handling this issue. It's not, with all due respect, an intelligent approach.  Mr. Casey needs to understand that hotels are businesses.  He needs to focus on how to help the hotels recover a better level of net operating income which will assure the maintenance of jobs and improve the overall standard of living for his union employees at the same time.  

If Mr. Casey created a giant online simulation of the fiscal dynamics of the SF hotel industry, took that into discussions, and used it it as a tool for the crafting of a resolution that works for everyone, he would find better conversational weather with hotel managers frantically trying to avoid losing money.

But if he continues his anti-intellectual, 1960s, and in some cases thug-like approach, he will serve neither his members or the San Francisco Hotel Industry well, and the current negative management / labor climate will continue, possibly with job cuts to follow.

No one wants that.

Mr. Casey would do well to follow the conversation at The World Economic Forum in Davos.  The World's industrialized nations are struggling with lower revenues, enormous debt, and fears of a double-dip recession.  This the climate Mr. Casey is in today.

Stay tuned.