TIPPING THE SCALES AGAINST THE HELP
By Joe Brancatelli
September 18, 2014 --Europe's skies are particularly unfriendly right now as pilots in several nations push back against airlines demanding huge concessions so they can shore up their bottom lines.
But, fear not, fellow travelers. American ingenuity has the solution: Tip envelopes. One of the world's largest hotel chains this week began reminding us to spiff the chambermaids so that it could continue to pay at or near minimum wages.
Welcome to life on the road circa 2014. Airlines and hotels are reaping record profits and our ticket prices and room rates are rising. Yet the folks we depend on to fly planes, move baggage, clean rooms and serve grub are being asked to live off the kindness of strangers.
Before we continue this inevitably contentious discussion, full disclosure. I'm a big fan of tipping ¬— and tipping big — on the road. Tipping freely was my take-away tip in a column about better business-travel tactics. We've also discussed strategies for tipping on the road. Tipping is the American Way — if not the European or Asian Way — and I enthusiastically embrace it.
And, yes, the wage war is a battle that extends far beyond the bubble of business travel. Hundreds of protesting fast-food workers were arrested last week. And rightly or wrongly, Walmart is now the avatar of 21st century companies profiting while its employees solicit donations for food.
I get it. It's Dickens for the modern era. More wealth is being upstreamed to fewer people and the middle and lower classes are squeezed. It's free-market capitalism versus the social safety net and both sides have their well-honed talking points.
We have no chance of settling that argument here or even fully and fairly exploring all of the facts. But it's ridiculous to make believe that business travel is somehow immune. Our lives on the road now seem paved by people earning so little that they can't feed themselves or ever hope to become the people sitting in airline seats or checking into hotel rooms.
For logic's sake, let's start at the airport, where our business trips start. Union employees of airlines and airport operators do well enough, but most airport workers we interact with are not union and not well paid. In fact, they are minimum wagers and we depend on them to keep aircraft clean, assemble our grab-and-go food items, pour our drinks, move the bags and write the tickets.
It got so bad in the New York Metropolitan area that the bi-state Port Authority, which operates Kennedy, LaGuardia and Newark airports, was shamed into raising the minimum pay scale for employees of its tenants. Some airlines publicly resisted for months before bowing to public pressure.
Similar "living wage" requirements have been imposed at Philadelphia airport and, earlier this month, at Chicago's O'Hare and Midway airports. And in the town of Sea-Tac, where Seattle-Tacoma International Airport is located, a $15-an-hour minimum drew national attention. It also drew rhetorical blood as those who claim higher wages don't hurt employment and those who do both claimed victory on the same day last week.
Yet airlines seem adamantly opposed to paying airport workers fairly. United Airlines, for example, last week cancelled a contract with an existing operator at its Denver hub and then switched to a cheaper firm. It also is laying off its own workers and moving essential airport functions to third parties who pay employees less.
In fact, airlines are notoriously parsimonious with employees now. Carriers never scrimped on C-suite salaries, but, no matter what you've heard, most pilots and flight attendants have never made much money. Some qualify for food stamps — and get fired for admitting it. Young pilots working for regional airlines often earn less than truck drivers. And Northwest Airlines once notoriously told laid-off employees that they could always survive by dumpster diving.
Sadly, little of the record profit that the U.S. carriers boast about trickles down to the employees we depend upon to keep us flying.
American Airlines recently demanded new concessions from the pilots of its Envoy regional-carrier division. When the aviators refused — their salaries and benefits already had been cut several times in recent years — American management responded by shrinking Envoy. First it assigned newly purchased aircraft to third-party operations that pay pilots less. Then it shifted dozens of planes in Envoy's existing fleet to other, cheaper divisions. And for the first time, the airline's 14,000 passenger-service agents this week voted to unionize. The demands in contract talks probably won't be for lavish wages-and-benefit increases. They'll just be looking to win back some of the numerous concessions granted to American in previous years.
Perhaps you heard this week that United Airlines is offering a buyout of as much as $100,000 to some flight attendants. What you probably didn't realize is that United wants its best workers out because the airline doesn't want to pay them. "The cost is less to have a flight attendant with less experience versus one that has more," a United spokeswoman told Bloomberg News.
Things are better for some airline workers in Europe, but their wages and benefits are under attack, too, which explains this week's job action at Air France and a near-strike at Lufthansa. Pilots are fighting the carriers' plans to slash wages and benefits by shifting work to lower-cost subsidiaries. Willie Walsh, who now runs the holding company that owns British Airways and Iberia, beat his unions and drove down salaries after a series of costly strikes. But workers at other carriers have convinced European courts to roll back wage-crushing maneuvers.
Which brings us back to the tip envelopes that Marriott is placing in its hotel rooms. Marriott positioned the decision as something that empowers the (mostly) women who clean its rooms. In the very same announcement, Marriott couldn't resist telling you that it "reported revenues of nearly $13 billion in fiscal year 2013." What it didn't say was that it earned $626 million last year, up from $571 million in fiscal 2012. It makes you wonder why a hugely profitable chain of 4,000 hotels can't find a way to pay maids enough so it doesn't have to hustle guests into tipping.
Don't think the situation is unique to Marriott. Regardless of brand affiliation, hotels are notorious for paying front-line workers poorly. The average wage for a maid is south of $9 a hour. Meanwhile, Hyatt and other chains have aggressively laid off cleaning staff and replaced them with third-party services that pay employees even less. The policy occasionally leads to boycott threats from politicians.
How bad is it for hotel maids? Michael Matthews, who has spent 50 years working with major lodging chains worldwide, once calculated that the average chambermaid is required to clean at blazing speed — about four seconds per square foot — and is paid about half-a-cent a square foot for her efforts.
"If you and your family live in a 2,000-square-foot home, can you or your spouse clean it in about two hours?" he asks. "And would you do it for $10?"
ABOUT JOE BRANCATELLI Joe Brancatelli is a publication consultant, which means that he helps media companies start, fix and reposition newspapers, magazines and Web sites. He's also the former executive editor of Frequent Flyer and has been a consultant to or columnist for more business-travel and leisure-travel publishing operations than he can remember. He started his career as a business journalist and created JoeSentMe in the dark days after 9/11 while he was stranded in a hotel room in San Francisco. He lives on the Hudson River in the tourist town of Cold Spring.
THE FINE PRINT This column is Copyright © 2014 American City Business Journals. All rights reserved. Reprinted with permission. JoeSentMe.com is Copyright © 2014 by Joe Brancatelli. All rights reserved.