# Appendix — Portman v. National Labor Relations Board > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385020_0562%3A2 ## Record - **Collection:** Supreme Court brief - **Document type:** Appendix - **Published:** January 1, 1989 - **Citation:** 493 U.S. 994 ## Text « ) 89-727 © FILED Nov 4 1989 IN THE } JOSEP -F-SPANIOL, JR. CLERK é . Cp ate © -- Supreme Court of the United States OctToBerR TERM, 1989 a ~ THE PORTMAN, Petitioner, V. NATIONAL LABOR RELATIONS BOA RD and INTERNATIONAL UNION OF OPERATING ENGINEERS, STATIONARY ENGINEERS, LOCAL 39, AFL-CIO, Respondents. a = — PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT a SUPPLEMENTAL APPENDIX > > ARCH STOKES (Counsel of cord) FREDERICK L. WARREN STOKES, LAZARUS & CARMICHAEL 80 Peachtree Park Drive Atlanta, GA 30309 (404) 352-1465 Attorneys for Petitioner Tower Printing Company, 2 Peachtree St., Atlanta, GA 30383 (404) 659-4080 No. IN THE Supreme Court of the Hnited States Octoser TERM, 1989 »s ~~ THE PORTMAN, _ Petitioner, v. NATIONAL LABOR RELATIONS BOARD and INTERNATIONAL UNION OF OPERATING ENGINEERS, STATIONARY ENGINEERS, LOCAL 39, AFL-CIO, Respondents. A —_ PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT a ~ SUPPLEMENTAL APPENDIX a - ARCH STOKES (Counsel of Record) . FREDERICK L. WARREN STOKES, LAZARUS & CARMICHAEL 80 Peachtree Park Drive Atlanta, GA 30309 (404) 352-1465 Attorneys for Petitioner + ? af a a iy a A “~ Be: ag 4 Ee Orr ete a e TABLE OF CONTENTS SUPPLEMENTAL APPENDIX: Page The Portman, 291 NLRB No. 45 (September 30, 1988).............. A-3 The Portman, NLRB Case No. 20-RC-16191 (1988)...........s:::0++ A-4 Ruling on Appeal by Robert H. Miller, Regional Di- rector, Region 20 dated November 20, 1987; Appeal to Regional Director from Hearing Officer’s Refusal to Admit Expert Testimonial Evidence of Professor Paul Gaurnier dated November 18, 1987; and Affidavit of Professor Paul Gaurnier as an Offer of Proof dated TTI TIE ics Nish hctnesepinis hab nennsicaenenndnaanencanadibinnquneantenseanesnenees A-5 iii mas | per ‘jet conn’ oe OS a I oe as oe , oe ee TABLE OF CONTENTS SUPPLEMENTAL APPENDIX: Page The Portman, 291 NLRB No. 45 (September 30, 1988).............. The Portman, NLRB Case No. 20-RC-16191 (1988)............0.000+ Ruling on Appeal by Robert H. Miller, Regional Di- rector, Region 20 dated November 20, 1987; Appeal to Regional Director from Hearing Officer’s Refusal to Admit Expert Testimonial Evidence of Professor Paul Gaurnier dated November 18, 1987; and Affidavit of Professor Paul Gaurnier as an Offer of Proof dated SU ig MONE The parties stipulated to the following commerce facts: The Employer is a California corporation with a facility in San Francisco, California and has been engaged in the operation of a hotel providing food and lodging services since it opened for business on September 2, 1987. Upon a projection of its business operations from its opening in September 1987 to November 1987, the Employer will derive annually gross revenues in excess of $500,000.00. Since the opening of its San Francisco facility in September 1987, the Employer has purchased and received at that facility goods valued In excess of $1,500.00 directly from points located outside the State of California. Based on these facts, I find that the Employer meets the Board's jurisdictional standards under Sections 2(2), (6) and (7) of the Act. * The Petitioner requests a unit of maintenance and engineering department employees, excluding all other employees. The Employer takes the position A-4d that such a unit is inappropriate and that the only appropriate unit is one that includes all hotel employees. For the reasons set forth below, | find that a unit of engineering employees is appropriate. The record shows that the Employer is large, luxury hotel which opened for business in September 1987. The hotel's facilities include 340 guest rooms; several food and beverage facilities, including a restaurant, lounge, buffet, and employee cafeteria; several conference rooms and a ballroom. Overall responsibility for the hotel is in the hands of the vice president and managing director, Pat Mene. Mene, together with the director of human relations, the director of marketing and the comptroller, comprise the executive operating committee. This committee is charged with overseeing the day-to-day operations of the hotel. Reporting to Mene are the heads of ten different divisions, entitled respectively administration, front office, guest room services, conference and catering, marketing, kitchen, room service, grill, beverage management, and property management. These divisions are further organized into subdivisions headed by individuals denoted by the Employer as either managers or supervisors. Approximately 350 individuals work at the Portman. There is no history of collective bargaining and no other labor organization seeks to represent any of the Employer's employees. The property management division is headed by Michael Jump. Reporting directly to Jump are the house, light and power supervisor, Ralph Mork, a support services coordinator, Renee Heider, and the acting executive steward, Dennis Rollo. Heider supervises approximately three lobby porters and also orders engineering supplies under Jump’s direction. In addition, Heider coordinates the work of outside contractors who handle flowers and greenery for the hotel and other contractors who perform certain cleaning work. When Mork was hired in April, 1987, he was told by Jump that he would be serving in the capacity of assistant chief engineer and that Jump’s position was equivalent to that of chief ¢.igineer, in addition to other duties. Approximately two weeks prior to the beginning of the hearing in this case, Mork was informed that henceforth, he was going to have full responsibility for overseeing the engineers work, in order that Jump’s work load would be lightened. Eight engineers report directly to Mork. Six of these individuals are considered as general maintenance engineers, while one specializes in painting and another js considered to be the carpentry specialist. The job title of all eight individuals is property management engineer. The record shows that all eight engineers had substantial experience per- forming highly skilled engineering work prior to joining the Portman staff. Two of the engineers worked for several years as engineers at other hotels. One of these two was described by Mork as a skilled carpenter, while the other had also worked as a laborer foreman in the construction of the Portman and was familiar with the hotel's inner workings. Another engineer has a masters degree in environmental engineering with expertise in heating, ventilation and air conditioning and had worked previously as a remodeling general contractor. One of the engineers had worked for approximately six years as an independent contractor performing cabinet making, painting and paperhanging work, while another previously had worked with a general building contractor and had been a laborer on several projects at another hotel. Mork described this individual as having expertise in cement work, ceilings and plumbing. One of the engineers had owned a television and electronics repair shop for twelve years, while another had worked for several years as a building automation computer technician and had been emplyed for one and one-half years as an engineer at a high-rise office building. Finally, one of the engineers had been employed as an engineer in a large office building for a period of several years. The engineers are charged with monitoring and performing preventive maintenance and emergency repairs on several mechanical systems essential to the functioning of the hotel. Although these systems, in addition to other equipment, are still covered by warranty, the engineers eventually will be charged with repairing them and all other electrical mechanical devices in the hotel. Exceptions to this are the elevators and the air conditioning systems, which are to be handled by outside contractors. The engineers are responsible for monitoring and maintaining low pressure boilers, cooling towers, an emergency diesel power system, two 350-ton train chillers with pumps, a computerized building automation system and a computerized life safety system, and two air compressor systems. No other employees at the Portman have responsibility for monitoring, maintaining and repairing these systems. The engineers were provided with certain training to aid them in performing these functions, including a two-week course on the two computerized syste..is and other training sessions focusing on the boilers, A-4f the sprinkler contro! systems, the chillers and the refrigeration equipment. All of the engineering subdivision employees received this training regardless of their area of specialty within the subdivision. No other employees participated in these training sessions. The engineers, in addition to the kitchen employees, were given training on the kitchen equipment. Engineers are also charged with effecting repairs on plumbing, hardware, woodwork, machinery and all varieties of electrical and mechanical devices throughout the facility, subject to the warranty restrictions mentioned above. Repair orders reach the engineering staff via written or oral work requests, which come into the engineering office shared by Mork and Heider. There is no evidence that any other employees receive work assignments in like manner, other than the maintenance attendant discussed in detail below. The evidence shows that, in the interests of efficiency, employees in other departments often try to make minor repairs requiring simple hand tools, such as screwdrivers, and may attempt to fix broken machinery prior to contacting the engineers. Some witnesses testified that such repair efforts by employees who are not engineers are more common at the Portman than at other hotels. However, with the exception of the maintenance attendant in the guest room services division, discussed in detail below, only engineers are charged with making repairs as a regular component of their duties. The record also reflects that, once an engineer arrives on the scene to make a repair, an employee in the department in which the repair is needed will often remain with the engineer and provide assistance by handing him or her tools or providing “a second set of hands” in dismantling cumbersome parts. When the engineer has completed the repair, he or she will often remain to assist in cleaning up any disarray or spills caused by the breakdown or the repair. In addition to these duties, engineers work on various special projects throughout the hotel. For example, engineers remodeled the banquet kitchen, assembled a weigh machine for the purchasing director, set up special electrical wiring for three gala events, and performed various custom carpentry jobs. The record also shows that engineers, and all other hotel employees, are exceptionally helpful to guests and to fellow employees. Thus, when they come across employees or guests needing assistance, engineers will help move furniture, lift luggage, and push heavy carts and boxes. A-4g The evidence reflects some overlapping duties between engineers and other employees. Engineers and personal valets (who clean guest rooms) work jointly in re-keying all of the locks in the hotel approximately every three weeks. Engineers, in addition to employees in some other departments, have assembled prefabricated furniture or installed shelving or bulletin boards. Employees in several departments change light bulbs in their respective work areas, while engineers also perform this function. Employees in several departments, in addition to engineers, perform trouble-shooting and make minor repairs on the hotel’s computer systems. In addition, engineers have worked with the assistant controller in setting up and redesigning the hotel’s computer hardware and wiring. The engineers work on three eight-hour shifts. Engineers on all shifts report to the engineering office when they arrive at work in order to sign in on a time sheet. Day shift and swing shift engineers receive work assignments from Mork upon arrival. Graveyard shift engineers meet with Mork before ending their shift. The watch engineer position is rotated among the engineers on a daily basis. The watch engineer spends about an hour making mechanical rounds and spends the remainder of the morning on repair work orders in guest rooms. At mid-shift, a second set of rounds is made and the remainder of the shift is spent again responding to repair requests. Repair work is performed by the engineers throughout the hotel, an well as four engineering shops consisting of a paint shop, a plumbing shop, a machine shop and a carpentry shop. These shops are located next to the engineering office. Also located on this floor on the basement level are Jump’s office, the chiller room, the guest room services (commonly known as housekeeping) office and a storage area. Engineers receive their work assignments from Mork. Mork sets priorities for work and assigns the various repair work and other projects to the engineering staff. Mork checks up on the work performed by the engineers, monitors their work times, and spends the remainder of his time ordering supplies and performing engineering work himself. Mork has full authority to grant overtime, while requests for time off must be approved by Jump. Although Jump gave Mork full authority to handle all disciplinary problems, no discipline other than verbal warnings has been meted out. None of these warnings have been documented in writing. Jump originally sets the wage. rates to be paid to the engineers. He has also held monthly meetings with the A-4h engineers in order to give them an opportunity to air grievances. The evidence does not establish whether Jump will continue to conduct these meetings now that Mork’s role in overseeing the engineering subdivision has been expanded. Neither Mork nor Jump has authority to discharge an employee but may only make recommendations to the director of human resources. This individual reviews the matter and refers it to Pat Mene, the vice president and managing director, for a final decision. Both Mork and Jump have played a role in hiring engineers. The hotel's hiring process begins with a telephone interview conducted by represen- tatives of the human resources department in which candidates are screened for personal qualities, such as helpfulness and desire to please others. Candidates who pass this screening are personally interviewed by the manager interested in hiring then. Managers have full authority to decide whether to hire prospective employees, subject only to a reference check conducted by the human resources division. Jump interviewed all of the engineering subdivision applicants and made the final hiring decisions. Mork participated with Jump in two interviews. In both cases he recommended to Jump that the candidates be hired and, in both cases, the individuals were hired. As noted above, the property management division includes lobby porters and stewards in addition to the engineering subdivision. Lobby porters are charged with cleaning the lobby, entry court and public rest rooms. Heider, their immediate supervisor, has authority to schedule their work and to handle disciplinary matters. Stewards work in the various kitchens and dining areas, washing dishes, emptying garbage and clearing and stacking plates. They report to work and sign in at the chief steward’s office. Two lead stewards oversee the activities of three to four stewards. According to Jump, the acting executive steward has authority effectively to recommend discipline, to schedule employees’ work, to grant overtime and to make, or effectively recommend, hiring decisions. The guests rooms services division employs an individual, Ben Balansag, whose job it is to make repairs in guest rooms and whose title is main- tainance attendant. Personal valets, who clean the guest rooms, initially try to make repairs and contact Balansag if they are unsuccessful in doing so. However, if a repair request is such that it will take longer than fifteen minutes to complete, Balansag is required to refer the job to the engineering A-4i subdivision. Balansag reports to work in the guest services division office but receives assignments in the form of written work orders which are kept in a slot marked with his name in the engineering subdivision office. Balansag frequently utilizes the engineering shops, where he obtains tools, parts and supplies and effects repairs. Balansag works together with engineers on a daily basis on repair projects and frequently looks to them for suggestions regarding his work. According to Jump, Balansag also receives work assignments from the engineering department three or four times a week when he is not busy with guest room repairs. Balansag worked for several years as an engineer at various hotels prior to joining the Portman staff. Jump devised a job description for Balansag’s job and also played a role in his hiring. Spencer Scott, the director of guest services, told Jump that he was looking for an individual with strong me- chanical and plumbing skills. He asked Jump to interview candidates and to make a hiring recommendation. Jump interviewed five candidates and referred two to Scott, one of whom was Balansag. Balansag testified that he was interviewed by Jump and then referred to Scott, who described the position to him. Balansag initially was paid at the rate of $10.52 per hour. Later, Jump recommended that Balansag be paid the same rate as the engineers, $19.93 per hour, as he was performing engineers’ work. Balansag was granted this wage Increase, effective November 4, 1987. Jump testified that, in his opinion, Balansag was a skilled engineer who was capable of being transferred into the engineering subdivision at any time. The record shows that the working conditions of the engineers, along with those of Balansag, differ in several respects from the conditions under which other employees work: The engineers and Balansag are the only employees who supply their own tools or who receive assignments in the form of work orders. Only the engineers and Balansag wear gray uniforms; other employees wear white or green uniforms. Engineers receive five uniforms per week, while other employees receive only three. While other employees may borrow hand tools from the engineers from time to time, only the engineers and Balansag utilize tools and work in the four engineering shops on a regular basis. Engineering subdivision employees are the only non- management employees to be issued “grand master” keys giving them access to virtually all doors in the hotel. According to Mork, engineers are the only empioyees who have been called back during periods they are not ~- A-4j scheduled to be working. This practice has been necessitated by the fact that the engineers possess expertise necessary to effect certain repairs. Finally, engineers and Balansag earn $19.93 per hour, substantially more than al! other rank and fil: employees at the Portman except for a part-time pianist, who earns $25.84 per hour, but who works only six hours per week and does not receive fringe benefits. The Vast majority of employees earn between $5.95 and $10.00 per hour. Certain clerical and accounting staff receive between $10.34 and $11.54 per hour, while the line cook earns $12.50 per hour and the bartender earns $11.77 per hour. Food service personnel and various service employees receive tips which supplement their wages. Engineers share certain terms and conditions of employment with other hotel employees. All employees, including engineers, utilize a designated employee entrance, eat meals and take breaks in an employee cafeteria, are subject to the same personnel policies and receive the same fringe benefits. All employees, including engineers, attend the same orientation seminars upon being hired. It is the Employer's policy to attempt to fill job vacancies from within the hotel and several employees have transferred to other positions. However, there have been no transfers into or out of the engineer- ing subdivision. - The evidence reflects that Petitioner is party to collective bargaining agreements covering employees at 25 major San Francisco hotels and 1 major hotel in neighboring San Mateo County. These agreements cover only engineering /maintenance department employees. The Employer introduced evidence showing that, of seventy hotels in San Francisco contacted by the Employer for information, forty-four have collective bargaining agreements with at least one union and twenty-five have agreements with Petitioner. The Employer's survey does not reflect whether any of the forty-four unionized hotels are organized into bargaining units in which engineers are combined with employees in other job classifications. The evidence also shows that the San Jose Hyatt Hotel In Santa Clara County, located south of San Mateo County, is party to a collective bargaining agreement covering ail of the hotel’s employees in a single “wall-to-wall unit.” In Hotel Sofitel, 20-RC- 16188, it was found, and I hereby take administrative notice that, in San Mateo County, five of the fourteen unionized hotels have contracts in which engineers are represented by Petitioner in a separate bargaining unit, while two hotels are party to union contracts covering all employees in “wall-to- A-4k wall” units. It was further found in that case that engineers at the Fairmont Hotel in Santa Clara County are represented by Petitioner in a separate unit, while at nine other hotels in Santa Clara County, engineers are represented in broader units, in some cases including all other hotel employees. In sum, the bargaining pattern in the three-county area described above appears to be mixed in nature with respect to whether engineers are represented in separate units for purposes of collective bargaining or as part of larger units. A substantial amount of evidence was adduced as to the exceptionally high quality and degree of service provided to guests of the Portman as compared to other large luxury hotels. In this regard, the evidence shows that employees of the Portman are instructed to give guest service their highest priority and to be courteous and helpful to guests and co-workers even when such helpfulness involves performing tasks that are not a regular component of their job duties. Several witnesses testified that engineers and all other Portman employees are friendlier, more cooperative among themselves, and offer more assistance to guests than employees of other major hotels in San Francisco and elsewhere. In making unit determinations in the hotel industry, the Board takes into account the same traditional community of interest considerations which it considers to be important in other industries, including distinctions in skills and functions of particular employment groupings, their separate supervi- sion, the employer's organizational structure and differences in wages and hours. 77 Operating Co., 160 NLRB 927 (1966), enfd. 387 F.2d 646 (4th Cir. 1967); Omni International Hotel of Detroit, 283 NLRB No. 73 (Mar. 31, 1987); Dunfey Family Corporation d/b/a Sheraton Motor Inn, 210 NLRB 790 (1974). The Board has, in several recent cases, specifically addressed the issue of whether engineering/maintenance department employees in a hotel constitute a separate appropriate unit. Sheraton-Anaheim Hotel, 252 NLRB 959 (1980); The Westin Hotel, 277 NRLB 1506 1986; Omni International Hotel of Detroit, supra; Maxim's de Paris Suite Hotel, 285 NLRB No. ¢1 (August 20, 1987) and Hilton Hotel Corporation, Sun Cal Investments No. 1, Ltd., d/b/a Los Angeles Airport Hilton and Towers, 287 NLRB No. 36 (December 16, 1987). See also Western Lodging Corp., d/b/a Stanford Park Hotel, 287 NRLB No. 137 (Feb. 29, 1988), in which the Board approved a petitioned-for unit consisting of maintenance and housekeeping employees where such employees shared separate immediate supervision. A-4l In the first of these cases, Sheraton-Anaheim Hotel, supra, the Board adopted the Regional Director’s findings that the engineering employees’ distinct skills and separate supervision by the chief engineer indicated that a separate unit of these employees was appropriate, in spite of the fact that the engineers were not “highly skilled,” that there was some, albeit minimal, overlapping of duties between these employees and those in other de- partments and that there had been two permanent transfers and one temporary transfer into the department during the preceding two years. Engineers, in that case, performed both skilled and unskilled maintenance and repair work, while some of the more complex repair work was contracted out. Engineers in Sheraton-Anaheim shared certain working conditions as a group that differentiated them from the other employees: they were required to bring their own tools, they were assigned work pur- suant to a unique work order system and they carried a beeper at all times. In finding a separate unit to be appropriate, the Regional Director, in Sheraton-Anaheim, noted that there was a mixed pattern of bargaining for engineering / maintenance units in the local area, that there was a lack of any bargaining history at the hotel on a broader basis and that no other labor organization was seeking to represent hotel employees in a broader unit. Later, in Westin Hotel, supra, the Board, upon a remand from the U. S. Court of Appeals for the Seventh Circuit (reported at 738 F.2d 765), rejected a departmental unit of engineering/ maintenance employees in favor of an overall unit. In so doing, the Board distinguished Sheraton-Anaheim, supra, on the basis that the local area bargaining pattern in Westin was that of overall units and that an intervening labor organization desired to represent Westin employees in a “wall-to-wall” unit. In determining that a departmental unit was not appropriate, the Board noted that there was not strong evidence that the maintenance and engineering department employees possessed unique skills or that those employees were separately supervised. The Board further noted that maintenance and engineering employees occasionally worked together on projects with employees in other departments, that the duties of those employees and other hotel employees were functionally integrated, and that maintenance and engineering department employees worked under similar terms and conditions as those of other hotel employees. Maintenance employees, in Westin, were classified as Maintenance Worker I, II and III, according to their level of experience. The Maintenance Worker III position required only “mechanical aptitude.” Only two of the eleven maintenance A-4m employees were Maintenance Worker I employees, who performed the more technical tasks. The average pay for Westin maintenance employees fell within the median level for all hotel service employees. More recently, in Omni International Hotel, supra, Maxim's de Paris Suite Hotel, supra, and Los Angeles Airport Hilton and Towers, supra, the Board found units consisting exclusively of engineering / maintenance department employees to be appropriate. In all of these cases, the Board relied on the following community-of-interest indicia which are also present in the instant case: distinct job duties and unique skills, separate immediate supervision and higher wage rates paid to engineers than to other hotel employees, and a lack of interdepartmental transfers. In Maxim's, the Board relied on certain additional factors, which were present in Sheraton-Anahzim and which are also present in the instant case, namely, the fact that engineering department employees worked under a unique work order system and that they supplied their own tools. In both Omni and Maxim's, as in the instant case, the engineering department head himself made all final hiring decisions, whereas in Airport Hilton the personnel department interviewed job candidates and made all final hiring decisions. In these three cases, as in Sheraton-Anaheim and the instant case, engineering employees performed a wide range of funtions, from changing light bulbs to routine preventive maintenance and making all varieties of repairs. In Omni and Airport Hilton, as here, the hotel’s equipment was still under warranty at the time hearing and, thus, major repairs were being performed by outside repair persons. In Maxim's, outside contractors provided repair services for televisions, elevators, fire alarms, fire sprinkler systems, tile, marble and office equipment. Engineering department employees in that ¢ase did not perform major structural alterations or major air conditioner repairs. In all three of the Board’s post-Westin cases, the Board distinguished Westin on the basis that, unlike the circumstances in Westin, there was not a prevailing local area pattern favoring overall units and no other labor organization had expressed an interest in representing the employer's employees in a broader unit. In Omni, the local_area bargaining pattern among hotels was that of engineering department units, whereas in Maxim's and Airport Hilton, as in the instant case, the local area pattern was a mixed one. ; ~ _ A-4n In all of the post-Westin cases the Board expressly discounted the significance of certain community-of-interest factors which it previously had found to be important in Westin. Thus, in Maxim's, the Board quoted its decision in Omni in which it had stated that the fact that employees in different departments occasionally assist each other with various projects “reflect(s] a ‘spirit of cooperation or civility’ rather than an overlap of job functions.” 285 NLRB No. 61, slip op. at p. 4, quoting 283 NLRB No. 73, slip op. at p. 3. Further- more, in Omni, the Board noted that, while other employees occasionally performed certain minor maintenance tasks, no other employees regularly performed maintenance work. In Airport Hilton, the Board acknowledged evidence as to a number ot instances in which engineering department employees had worked alongside non-engineering department employees and other evidence disclosing that some nonengineering department employees occasionally had performed maintenance type work. In addressing such evidence the Board stated that: certain common endeavors which occur between engineering department employees and in the kitchen, housekeeping, security, and other departments do not obliterate the clear functional distinction between the essentially maintenance and repair duties of the engineering department and the duties required of, and performed by, nonengineering employees.” In a footnote to this sentence the Board further commented: Thus, for example, the Employer places great emphasis on contacts between engineering department employees and employees in departments such as housekeeping. It details record evidence that employees In these two departments interact in the cleaning of major water leaks and other cleanup and maintenance operations. Although it is clear that such incidents of cooperation occur, we are not persuaded that they establish a blurring of the functional distinction between the duties of engineering and the duties of housekeeping. Indeed, this difference in job duties to a large extent explains why the Employer pays housekeeping employees in the range of $4.25 to $4.75 per boar and pays engineering /maintenance employees up to $15.50 per hour. Apart from other factors, this wage disparity tends to undermine any claim that there is a sub- stantial overlap of job functions. — Airport Hilton, supra, 287 NLRB No. 36, slip op. at pp. 5-6. A-40 Finally, in both Omni and Maxim's, the Board emphasized that the sharing of certain terms and conditions of employment among engineering employees and other hotel employees—such as identical fringe benefits, punching the same time clock, wearing name tags and uniforms, being paid on an hourly basis, and sharing common overall supervision—fails to establish that a separate engineering/ maintenance unit is not an appropriate unit, even though such factors would constitute considerations in favor of an overall unit if such a unit had been sought. Omni, supra, 283 NLRB No. 73, slip op. at p. 4; Maxim's, supra, 285 NLRB No. 61, slip op. at p. 4. In light of the evidence described above and in accordance with current Board policy, I find that a unit of engineering-subdivision employees is appropriate. As the above discussion illustrates, all of the Board’s recent decisions on this issue are directly applicable to the circumstances in this case. The Employer contends that the Portman’s “product,” which it char- acterizes as “world-class oriental service,” will be “destroyed” if the Region determines that a unit consisting only of engineers is appropriate. The Employer reasons that its “product” requires employees to operate as a team in providing services to guests and that a unit which encompasses only one group of employees will interfere with the Employer’s team approach. The Employer does not explain, however, why a unit composed exclusively of engineers will have this undesired effect. As noted above, the Board specifically addressed the issue of overlapping duties and interdepartmental cooperation in all three of its post-Westin decisions and, in all three cases, the Board determined that, in spite of such circumstances, the evidence nevertheless reflected clear functional distinctions between engineers and employees in other departments. While the engineers at the Portman may be more helpful to guests and co-workers than engineers at some other hotels, and while employees in other departments at the Portman may attempt simple repairs more frequently than at some other hotels, such overlap is incidental and does not reflect any greater degree of functional integration than was present at the hotels which were the focus of the Board’s post- Westin decisions. With respect to the unit placement of maintenance attendant Ben Balansag, the record reflects that Balansag shares an overwhelming community of interest with the engineers. Balansag performs repair duties of the same nature as those handled by the egineers, he is paid the same wage rate aythe engineers, he wears the same type of A-4p uniform and receives job assignments in the same manner as the engineers. He uti- lizes the same tools and work areas as the engineers in performing his work. Peti- tioner requests that Balansag be included in the engineering subdivision unit, while the Employer has expressed no position on this matter. Under these circumstances, I find that Balansag is included in the unit herein found appropriate. The Employer has not taken a position as to the supervisory status of Ralph Mork. The Union, while contending that Mork was not a supervisor, conceded that this was a “close question” and acknowledged that “Mork may, in fact, be in the process of becoming a supervisor within the meaning of the Act.” The evidence shows that Mork uses independent judgment in assigning work to engineers, inspecting their work and making schedule changes. In addition, the record reflects that he grants overtime and that he has authority to discipline engineers. Based on this evidence, I find that Mork is a supervisor within the meaning of Section 2(11) of the Act and that he is excluded from the unit. A-4q November 20, 1987 THE PORTMAN, Employer and Case 20-RC-16191 INTERNATIONAL UNION OF OPERATING ENGINEERS, STATIONARY ENGINEERS, LOCAL 39, Petitioner. RULING ON APPEAL After careful consideration, | have denied your appeal of the Hearing Officer’s ruling to prohibit the testimony of proffered witness Professor Paul Gaurnier. Robert H. Miller, Regional Director Region 20 A-5a BEFORE THE NATIONAL LABOR RELATIONS BOARD REGION 20 THE PORTMAN, Employer, CASE NO. 20-RC-16191_—- and INTERNATIONAL UNION APPEAL TO REGIONAL OF OPERATING DIRECTOR FROM HEAR- ENGINEERS, STATION- ING OFFICER’S REFUSAL ARY ENGINEERS, TO ADMIT EXPERT TES- LOCAL 39, TIMONIAL EVIDENCE OF she PROFESSOR PAUL Petitioner, GAURNIER ; ¢ TO THE HONORABLE ROBER MILLER ~~ REGIONAL DIRECTOR INTRODUCTION This case involves a unit determination in which the 1.U.0.E., Local 39 (“union”) petitioned to organize what the union claims is an engineering unit for purposes of collective bargaining at The Portman, a luxury, transient hotel located at Post and Mason Streets, San Francisco California. The Portman maintains there exist sufficient functional integration and community of interest among all nonsupervisory job classifications to justify an all-employee unit. The Portman has presented over one dozen witnesses and thirty-pius exhibits over eight days of hearings. Evidence, both ~ testimonial and documentary, has been received comparing engineering job duties, functional integration, and commonality of interests at The Portman with several San Francisco area hotels within what the union contends is the “area pattern of bargaining.” On Tuesday, November 17, 1987, The Portman offered the testimonial expert evidence of Professor Paul Gaurnier, of the School of Hotel Administration, Cornell University, Ithaca, New York. Subsequent to oral argument on the record by Arch Stokes, counsel for The Portman, regarding the admissibility and relevance of Professor Gaurnier’s testimony, and pursuant to Section 11226, N.L.R.B. Casehandling Manual, Inter Alia, Mr. Stokes proffered the affidavit of Professor Gaurnier as a partial offer of proof. Additionally, Mr. Stokes requested that the complete offer of proof on the admissibility and relevance of Professor Gaurnier’s testimony be an examination of Professor Gaurnier himself, who was present in the hearing room, ready, willing and able to testify. The Hearing Officer reviewed Professor Gaurnier’s 25-page affidavit in a few minutes and ruled (1) that the affidavit was the only offer of proof allowed, and (2) that Professor Gaurnier’s testimony was inadmissible. This ruling was in spite of a further offer of proof by Mr. Stokes that Professor Gaurnier had participated in the design of the “Property Management Division” at the St. Francis Hotel in San Francisco, a subject explored on cross-examination by union's counsel of Michael Jump, Director of Property Management Division at The Portman. The Portman now appeals from the Hearing Officer’s ruling and incorporates by reference the previously submitted affidavit of Professor Gaurnier, as well as the oral representations of Professor Gaurnier’s testimony by Mr. Stokes as an offer of A-5c¢ proof supporting the admissibility of his expert testimony. The Portman further appeals the Hearing Officer’s refusal to take testimony of Professor Gaurnier as an additional offer of proof. The Portman also appeals the Hearing Officer's refusal to receive Professor Gaurnier’s testimony in rebuttal of evidence adduced on cross examination of Michael Jump by opposing counsel. Professor Gaurnier's expert testimony is critical to estab- lishing that the petitioned-for unit is “utterly inappropriate” for this employer and its associates (employees). The Portman’s product is unique, professional, luxury hospitality service in the highly competitive hotel industry in the United States and, more particularly, San Francisco and Northern California. This product demands difference. This product demands a synergism between and among all guests and employees in architectural design and people service. The segregated, gerrymandered petitioned-for unit is anathema to this product which is inextricably intertwined with employee relations at The Portman. A proliferation of segregated units would drastically affect, at best, and destroy, at worst, the raison d’etre oc The Portman. The bases for admission of this expert evidence are as follows: (1) While the rules -of evidence are not strictly ad- hered to in N.L.R.B. “RC” unit determination hearings, the established administrative rules and procedures demand liberality and not Draconian restriction on the admissibility of evidence. (2) The N.L.R.B.’s own Rules, Regulations, Statements of Procedure, and Casehandling Manual require a full and complete record. A-5d (3) (4) (5) (6) The Supreme Court of the United States has opined that due process forbids an agency to use evidence in a way that forecloses an opportunity to offer a contrary presentation. The Portman has the burden of convincing the Regional Director that the petitioned-for unit is inappropriate. Accordingly, The Portman should be afforded a full opportunity to present its position and to produce significant facts in support thereof. ' Union Exhibits 1, 2 and 3 were introduced for the purposes of establishing the “area pattern of bargaining.” Thus, the union has opened the door for the admission of evidence relating to so-called engineering bargaining units in San Francisco. This necessarily makes relevant evidence of whether the “pattern” is applicable to The Portman. Evidence comparing the engineering areas of hotels in what the union contends to be the “area _ pattern of bargaining” is, by definition, admissible (7) since the N.L.R.B. and Regional Directors have determined applicable “areas” in numerous cases. On the first day of the hearing, the Hearing Officer overruled union objections to questions by The Portman’s counsel on an analysis and comparison of job duties set forth in union Exhibits 1, 2 and 3. This was during examination of Robert Hydorn, a union representative who has never worked at The Portman and who has no personal knowledge A-5e of the job duties of the engineering associates at The Portman. (8) The Regional Director must consider the facts and the result of comparison cases when determining the appropriateness of the proposed bargaining unit. This necessarily includes the “holdings” of relevant board decisions, as well as comparative bargaining units in the area. For example, the Hearing Officer cited the Omni/Detroit “RC” case as “seminal.” The Portman would, of course, be allowed to introduce evidence distinguishing its facts from that case, among others. Similarly, it should be allowed to distinguish itself from other hotel bargaining units in what the union claims to be the “area pattern of bargaining.” Therefore, to prohibit an expert witness from testifying to factual similarities or distinctions between The Portman and a hotel which the union argues is the “same” for bargaining purposes would be arbi- trary, capricious, and a denial of due process. STATEMENT OF FACTS The union offered Mr. Robert Hydorn to authenticate union Exhibits 1, 2 and 3, and to establish that the petitioned-for bargaining unit was within the “area pattern of bargaining” among “Class A” luxury hotels in San Francisco. The Hearing Officer received the collective bargaining agreements between this union and approximately 25 hotels in the city and county of San Francisco. Tr. 10-26-87, p. 18, Ln. 9-25. William Sokol, counsel for the union, stated “for the record” that “this union is petitioning for the same unit as it represents in every Class A hotel in the city and county of San Francisco. .. . ” Tr. 10-26-87, p. 48, In. 15-18 (emphasis supplied). At several other points during Mr. Hydorn’s testimony, Mr. Sokol repeated the union’s position that the bargaining unit sought at The Portman is “exactly like” or the “same as” those bargaining units covered by union Exhibits 1, 2 and 3. Tr. 10-26- 87, p. 77, In. 6-9; p. 78, In. 19-20. For the purpose of supporting the union's position, Mr. Sokol questioned Mr. Hydorn concerning the job classifications and duties of the engineers employed at the hotels covered by those Exhibits. See, for example, Tr. 10-26-87, p. 29, In. 18-25; p. 30, In. 1-10, p. 33, In. 22- 25. Upon cross-examination, Arch Stokes further questioned Mr. Hydorn regarding the specific duties of the engineers cov- ered by union Exhibits 1, 2 and 3. Tr. 10-26-87, p. 74, In. 16-23. Mr. Sokol objected to this line of questioning on the basis that the Exhibits “spoke for themselves." Tr. 10-26-87, p. 75, In. 1-14. Mr. Stokes responded to the objection by stating that because the union had introduced union Exhibits 1, 2 and 3 for the purpose of establishing the “area pattert. ~f bargaining” standard, The Portman had the right to question this “so-called” expert to compare the duties of engineers in the existing bargaining units with those of the associates at The Portman. Tr. 10-26-87, p. 75, In. 15-25; p. 76, In. 1-21. Mr. Sokol’s objection was overruled by the Hearing Officer. Tr. 10-26-87, p. 76, In. 22. For an additional two and one-half pages of the transcript, Mr. Sokol argued that he “might” object to future comparative evidence and that he did object to the timing of receipt of comparative evidence. Tr. 10-26-87, p. 76-80. He recognized that Mr. Stokes intended “to also introduce evidence concerning job duties and classifications in the hotels in the city and county of A-5g ae San Francisco . . . for the purposes of comparison.” Tr. 10-26-87, p- 77, In. 9-12. The Hearing Officer again ruled in favor of the receipt of such evidence and the line of questioning to which Mr. Sokol was objecting. Tr. 10-26-87, p. 80, In. 7-8. Mr. Sokol continued to object and argued, despite the ruling. Tr. 10-26-87, p. 80-84. After luncheon recess, Mr. Stokes’ examination of Mr. Hydorn relating-to a comparison of the job duties continued consistent with the Hearing Officer's rulings. Tr. 10-26-87, p. 85- 88. Subsequently, further such comparative evidence was elicited and received from each and every witness who had worked at another hotel than The Portman, including Ralph Mork (Sir Francis Drake and The St. Francis), Mark Everton (The Four Seasons Clift), Spencer Scott (Hyatt), Larry Ott (Hyatt), Larry Sternberg (Hyatt, Omni and numerous others), Michael Jump (Meridien and Ramada Renaissance), Ban Balansag (Holiday Inns), Patrick Mene (Hyatt, Omni, Westin, and numerous others), and Charles Lo (Hyatt). Mr. Sokol himself exhaustively elicited comparative evidence of engineering duties at other San Francisco hotels covered by union Exhibits from Mr. Michael Jump, director of the Property Management Division at The Portman. ARGUMENT The comparative evidence offered by The Portman should be received into evidence. It will be a denial of administrative due process to admit, receive and consider the evidence thus far reflected in the record without admitting similar comparative evidence. The Due Process Clause forbids an agency to use evidence in a way that forecloses an opportunity to offer a contrary presentation. Red Ball Motor Freight, Inc. v. Arkansas-Best Freight System, Inc., 419 U.S. 281, 95 S. Ct. 438, 443, fn. 4 (1974). A-5h It is the duty of an N.L.R.B. Hearing Officer to inquire fully into all matters and issues necessary to obtain a full and complete record upon which the N.L.R.B. or the Regional Di- rector may discharge their duties under § 9(c) of the Act. N.L.R.B. Rules and Regulations, Section 102.64(a). The parties are supposed to be afforded a full opportunity to present their respective positions and to produce the signif- icant facts in support of their contentions. N.L.R.B. Statements of Procedure, Section 101.20(c). These rules and procedures are not for the benefit of labor organizations, employers or administrative agencies. They are for the benefit of employees. The N.L.R.B. is responsible for conducting an election that will reflect the free choice of em- ployees in the appropriate unit. N.L.R.B. Statements of Pro- cedure, Section 101.18(a). The determination of the electorate is obviously the most critical decision in furtherance of employees’ rights collectively to bargain or to refrain therefrom within the meaning of the Act. The refusal of an administrative agency to consider evi- dence introduced at a hearing before it constitutes arbitrary action. See, e.g., S.D. Warren, Co. v. N.L.R.B., 342 F.2d 814 (1st Cir. 1965). Refusal by an administrative body to consider factors 4 properly before it and relevant to the decision at hand is arbitrary and capricious. See Cousins v. Oliver, 369 F. Supp. 553 (E.D. Va. 1976). Administrative agency actions must have a reasonable or rational basis if it is to avoid the stigma of arbitrariness. See Carlisle Paper Box Co. v. N.L.R.B., 398 F.2d 1 (3rd Cir. 1968); Mil Ka Ko Research & Development Corp. v. Office of Economic Oppor- A-5i ieee tunity, 352 F. Supp. 169 (D.C.D.C. 1972), aff'd, 497 F.2d 684 (D.C. Cir. 1974). _ Logistical and ministerial considerations should eclipse the admissibility of Professor Pau! Gaurnier’s testimony. As a matter of fact, more time and argument have been wasted on and off the record regarding this issue than the time necessary for the testimony itself. The Portman recognizes its burden herein. It has to show the petitioned-for unit is clearly inappropriate. See Arcadian Shores, Inc., d/bla Myrtle Beach Hilton, 229 N.L.R.B 806 (1977), enfd, 580 F.2d 118 (4th Cir. 1978). Accordingly, to prohibit The Portman from introducing similar comparative evidence con- trary to the union’s “area pattern” evidence, would be arbitrary and capricious. A fortiori, this comparative evidence has already been adduced, much of it based upon the union’s questioning. This 18th day of November, 1987. Respectfully Submitted, /S/ ARCH STOKES /S/ MARGARET A. MEAD COUNSEL FOR THE PORTMAN STOKES, LAZARUS & CARMICHAEL 80 Peachtree Park Dr., N.E. Atlanta, Georgia 30309 (404) 352-1465 AFFIDAVIT This affidavit is given as an “Offer of Proof” in the Unit Determination Case involving The Portman Hotel and Local 39 of the International Union of Operating Engineers before Region 20 of the National Labor Relations Board in San Francisco, California. I, Professor Emeritus Paul L. Gaurnier, of the School of Hotel Administration, Cornell University, Ithaca, New York, do hereby swear that the following facts and statements are true and accurate to the best of my knowledge and belief: 1. I have taught hotel operations at the School of Hotel Administration at Cornell University to both seniors and graduate students for 19 years as a Professor of Management and Associate Dean and Acting Dean of the School. I have a Bachelor of Science Degree (1950) from Cornell University’s School of Hotel Administration and a Master of Science (1956) from the same school. My personal resume is as follows: PERSONAL VITA PAUL L. GAURNIER Present Position Professor of Management, School of Hotel Administration, Cornell University. Responsible for Hotel Operations and Business Policy and Strategy courses. A-5k Educational Background Cornell University, School of Hotel Administration, Master of Science, 1956; Bachelor of Science, 1950. Areas of Experience Has held responsible positions in a wide variety of ad- ministrative, managerial, and operating positions at all levels ci the Army, and also served three years with the Headquarters of the Defense Supply Agency, Department of Defense. Has served as: © Assistant Dean, then Associate Dean of the School of Hotel Administration, Cornell University from September 1967 through June 1978 Director, Cornell Hotel and Restaurant Center for Professional Development, 1968 through 1979 Academic consultant for the Hilton International Career Development Institute Expert hotel operations witness for eight law firms over the past five years Consultant to six different investment/syndication groups over the past five years with responsibility to estimate “value” of acquisitions being considered and to select contract management company. Other Consulting Responsibilities Consultant to General Telephone and Electronics (GTE). First as senior consultant on the planning and construction of their Advanced Management Education Center in Norwalk, Connecticut. Second as person directly responsible for preparing Invitation for Bids, evaluating the IFB’s, and then recommending A-5l selection of contract management company. Currently on retainer as advisor on the overall hotel operations, including standards of service, performance appraisal, and productivity analysis. (1980 - Present.) Advisor to Motor Hotel Management, Incorporated, the largest independent hotel contract management company in the U.S. with regard to all phases of hotel operations including feasibility studies, site selections, development and training of personnel, projected markets and organizational structure to meet those markets. Works closely with the President and Senior Vice Presidents of the company on an annual retainer basis (1978 to Present.) Advisor of the First Expandominium and Syndications, Inc. group, headquartered in Clearwater, Florida. Worked closely with the Chairman of the Board and Vice President on an annual retainer basis. Major project involved the development of the Ravines Executive Meeting Place and Country Club, a luxury Florida resort. (1982 - 1983) Project director of a major study for the Worid Bank, in Washington, D.C., to evaluate their entire food service/ contractual arrangements. Responsibility ‘acluded a complete questionnaire and survey of the 5,000 person World Bank staff; a thorough analysis of the contractual obligations with both the World Bank and the contractor; a thorough review of the food production, food service, and purchasing procedures being followed by the contractor; and analysis and recommendations as to organizational reporting structure within the World Bank which would better serve the Bank to oversee a multi-thousand meal a day operation. As an individual, worked with Bank officials on a follow-up study a year later. (1980 - 1981) A-5m Advisor to Fulop, Rolston, Burns & McKittrick, a Law Corporation, Beverly Hills, California, with regard to a defense preparation of a $140,000,000 claim by plaintiff (Dunes Hotel, Las Vegas) against Fulop, Rolston’s client. My responsibilities involved complete analysis of the effectiveness of Dunes Hotel management strategy, the market segmentation approaches taken by management, the efficiency of the Dunes Hotel operations (to include rate setting, expenses, cost controls, productivity analysis, staffing scheduling, and market niche positioning), and financial projections concerning future revenues. (1977 - 1980) Consultant to the Jefferson Company, Minneapolis, Minnesota, concerning a complete rehabilitation project on the St. Paul Hotel in St. Paul. Worked directly with the Chairman of the Board and the President in analyzing feasibility studies, methods of potential financing, standards for hotel operations, and types of market needs existing in St. Paul and how these needs could be best served and by which type of hotel and hotel company. (1979 - 1980) Project director of a complete study for the Puerto Rico Industrial Development Company concerning the convention center complex in San Juan, to include the two hotels connected to the convention center. This project resulted in a complete analysis for Pridco, to include market potential, rates, income, expenses, energy costs, hotel operations, union relations, contract management recommendations and estimates of net present values of each individual property involved with the convention center. Personally assumed responsibility on a separate consulting agreement with Pridco officials to negotiate a contract with a hotel operating company to operate this center, and to negotiate with potential investment groups concerning a possible sale of the complex. (1979 - 1980) Advisor to Motor Hotel Management, Incorporated on a special sixmonth full-time project to design, develop, and implement a manpower development program which would meet the needs of their very diversified 45-property manage- ment company. (1978) Project director of the joint venture School Program established by the Cornell University School of Administra- tion/Tourism Development Company of the Commonwealth of Puerto Rico. (1970 - 1978) Personal advisor to the Director of Tourism, Brazil, to evaluate proposals submitted by international hotel companies to build major hotels at various sites. Responsibilities included on-site inspections, recommendations as to type and size of proposed hotels, and the setting of standards required for the hotels to receive a luxury or first class designation by the Brazilian government. (1974 - 1975) Co-author of “How to Invest in People,” an industry-wide manual published under the auspices of the National Restaurant Association and funded by the Department of Labor. (1973) Senior consultant to the Department of Labor/National Restaurant Association to develop workable career ladders for non-management personnel in the food service industry. (1971 - 1973) Project director of the Department of Labor-funded study of “Career ladders and Manpower Development for Non- Management Personnel in the Food Service Industry,” to identify skill areas, physical requirements, levels of education, A-5o0 and training requirements for non-management food facility positions in the food service industry; to identify and evaluate current career system patterns and to construct a model career system or systems. (1969 - 1970) Co-author of the Department of Defense Report of the Procurement Program - Radios, which has been the definitive program used throughout the Department of Defense with regard to the purchasing of radios and like items. Additional Activiti Has lectured at numerous seminars in the United States, and in Japan, Korea, Hong Kong, Singapore, Okinawa, Mexico, Colombia, Peru, Brazil, France, Germany, Italy, Switzerland, and Sweden on different occasions. Has evaluated hotels for the Inter-American Development Bank with regard to site selection for their annual world-wide financial ministers meeting. Was member of the Steering Committee, Hotel Industry, National Alliance of Businessmen for two years. Has served as: Chief of: Hotel evaluation which annually surveyed Jamaica hotels for the Jamaica Tourist Board (1969 - 1970) Hotel evaluation group which completed a survey of 250 Caribbean Hotels for Air Canada (1971) Hotel evaluation group which completed a survey of Florida hotels for Air Canada (1972) A-5p Consultant to: Economic Development Corporation, New York, NY General Services Administration, Washington, DC Inter-American Development Bank, Washington, DC National Passenger Railroad Corporation (AMTRAK), Washington, DC Eight university study teams investigating the need for Hotel programs Chief of the Procurement Systems Branch in the Defense Supply Agency, DOD, which branch was charged with providing procurement analysis and supervision over the four-billion- dollar annual procurement of seven supply centers (1943 - 1 366) Principal supply advisor to Chief Quartermaster of the Republic of Vietnam Armed Forces, with direct responsibility for approval and administration of over 100,000,000 dollars of military aid supplies furnished to the Republic of Vietnam Armed Forces; and as such, * assisted in the development of a Vietnamese Industrial Base to meet the needs of the Viet- namese Department of Defense and that of the local economy. * made two special fact-finding trips to Korea to determine the capability of Korean industry to produce needed items to be used by the Viet- namese Armed Forces. ¢ directed the activities of a fact-finding team which set up in Taiwan the industrial capability to A-5q produce certain hard-to-get items needed for the Vietnamese Armed Forces. (1966 - 1967) As a paid consultant and executive seminar teacher, I have personally and physically inspected hundreds of hotels in the United States, Mexico, Canada, Jamaica, Antigua, Martinique, Guadeloupe, Barbados, The Virgin Islands, El Salvador, Brazil, Venezuela, Puerto Rico, Germany, France, Italy, Great Britain, Hawaii, Japan, Taiwan, Korea, Hong Kong, Singapore, ‘Indonesia, Thailand, Vietnam, India, Okinawa, Colombia, Peru, - Switzerland and Sweden. In each visit, I was officially touring the hotel as a consultant representing either the group that operated the hotel, or as the person who was presenting the principle of management/hotel operation seminars to the executives who were operating these properties and in order to make the seminar more topical, the executives wanted me to know exactly how they operated in order that I could use it in the seminar. In addition to having inspected hundreds of hotels, I have personally prepared and produced a written, analytical report concerning the entire operations of the property for at least 70 to 80 hotels in the Caribbean, South America, Mexico, Canada and the United States. For each of these written analytical reports I was a paid consultant to the owners, or to the hotel association, or to the government with responsibility for the operations of the hotels, especially the tourism departments of international governments. Hotel groups in the United States with which I have been directly involved in preparing operational analyses concerning many of their hotels, include the Marriott Group, the Hilton, Hyatt, Four Seasons, Sheraton, Stauffer, Ritz Cariton, Holiday Inns, Raphael Group (Alameda Plaza) and the Coleman Group (Tremont, Whitehall and the Navarro), and Japan A-5r Airlines when it was originally starting the Nikko Group. In the City of San Francisco itself, I have taken official tours with executives of the hotel showing me complete operations data and providing me with financial data of The Fairmont, Stanford Court, The Hilton, The Clift, The Donatello, The St. Francis, The Hyatt Regency, The Portman, The Holiday Inn, and The Handlerly Motor Inn. As a Professor of Management from the School of Hotel Administration at Cornell University, | have had the oppor- ‘tunity to lecture on the principles of management and hotel operations in the United States, Japan, Korea, Hong Kong, Singapore, India, Okinawa, Mexico, Colombia, Peru, Brazil, France, Germany, Italy, Switzerland, Sweden, Canada, Puerto Rico, Barbados, the Bahamas and Jamaica. At Cornell University, at the School of Hotel Administration Center for Professional Development, I was the Director of said Center for over 10 years, and personally lectured in the areas of principles of management and hotel operations. This past July (1987), the School of Hotel Administration presented a high level seminar limited to 26 qualified participants of General Managers and Resident Managers only, and I taught the first two days concerning the principles of organizational and functional assignments for hotel organizations as it pertained to hotel operations. There were 10 ‘other renowned faculty and industry executives who taught and none taught more than one day; my contribution was two days of the 10-day program. ‘ In 1985, I was one of two Professors who were brought over to Japan to lecture for a full week to various Japanese Chief Financial Officers and Chief Operating Officers for companies which were interested in expanding into the United States. This was an absolute give and take session in which the Japanese | A-5s \ Executives were expected to produce the basis for strategic decisions for the next few years regarding their expansion plans into this nation. The Steigenberger Group, the most noted hotel chain in Germany also hired me to analyze their strategic plans for moving into the United States and in the summer of 1984 I met with their top executives to discuss the strategy they had already laid out and I was able to convince them to change this strategy completely, which they did. In the 20 years that I have taught at the school of hotel administration at Cornell in both the Principles of Management and the Hotel Operations course, I have taught literally hundreds of under-graduates and graduates, many of whom are well-placed executives in the hotel industry today. For the past eight years that I was at the school, I taught (along with another Professor), a course that was designated as a capstone course because it utilized all the teaching from previous courses for the four years. This course was restricted to seniors and graduate students and was called a Hotel Simulation Exercise and was limited to 20 students. My responsibility in this course was to completely analyze the analyses turned in by the seniors and the graduate students concerning specified hotel properties, hotel chains and restaurant properties and chains, and my obligation was to turn back to the students a thorough analysis of the analytical reports they have prepared. In the hotel operations course, the students (both seniors and graduate students), were required to write complete analyses of all the hotels visited (such as the New York Hilton, the Washington Hyatt, the Boston Sheraton), and I was obligated to make a complete oral presentation concerning each and every one of these reports and to analyze the strengths and weaknesses of the reports the students had turned in. In doing this, I needed to make a thorough analysis of the. property A-5t myself in order to be able to compare it against the students’ projects. The Headquarters of Prudential Insurance Company has used me on several occasions as a mediator between the hotel management group operating the hotel and themselves. In each case, my report was completely accepted by both sides and all of the recommendations made were followed exactly. I have served as a mediator for M.H.M., Inc., the largest hotel operating management group in the United States on at least 10 occasions where they were at loggerheads with the owning group and both sides agreed to accept my written recommendations. I have taught hotel operations at the School of Hotel Administration for both seniors and graduate students for 19 years as a-Professor of Management and Associate Dean and Acting Dean of the School of Hotel Administration at Cornell University. During this time frame the hotel operations class has gone to the major hotel chains such as the Hilton, Hyatt, Sheraton, Holiday Inns, in addition to specific hotels, inde- pendent hotels such as the Saunders Group in Boston and the John Coleman Group in New York City previously called the Navarro, now the Ritz Carlton. In each case, the students were assigned specific projects that included analyzing the Department responsibilities for each of these various hotels and, especially the students were required to analyze the working relationships between Departments, between employees and supervisors, and between supervisors and top management within the hotels. The final report required of the students also had to include an analysis of the esprit de corps and the team effort that could be ascertained from visiting the property and how it related to guest satisfaction. Therefore, over the years, I have had the opportunity to read many well-written reports from bright young people who A-5u had no ax to grind at all in their evaluation of the organizational structure and the accomplishments of a particular hatel, especially as it related to the guest’s treatment and the satisfaction of the guest’s stay. In addition to this exposure to hotel operations, the enclosed resume indicates that I have done a considerable amount of work as a consultant in the industry. As a matter of fact, for the past five years I have taken a leave of absence for every Spring term at Cornell University because my consulting work was too heavy for me to teach both terms and to keep up with my work. Some of the background that is germane to this specific situation is my work with General Telephone and Electronics (GTE), first as a Senior Consultant on the entire planning and construction of their advanced management education center in Norwalk, Connecticut, and second as the person directly responsible for preparing the invitation for bids and evaluating those bids and then recommending the selection of the contract management company, and then probably the most important, a retainer as an advisor to GTE on the overall hotel operations including the standards of service and the performance and the productivity analysis that was so important to the atmosphere needed by GTE for their advanced management education center, in that the center, the rooms, the food, the beverage and all of the facilities were being operated by a third party; in this case Marriott received the contract. It was very important that the standards that GTE needed, especially for the ambience and the feeling of being part of the team that the attendees could feel, was almost as important as the material being covered in the seminar rooms. During the first two years of operation, it was necessary to request Marriott to relieve two executives from the center operations because of the attitudinal problems represented by both of these executives. This became necessary because I, as the Advisor to GTE, discovered that although the professionalism of A-5v these particular executives was beyond reproach and their technical capability was certainly beyond reproach and they had done very well with Marriott (and that was why they had been chosen for the positions), their attitude was not what was needed in order to fit in with the Program Directors that GTE used in order to have the seminars be acceptable to the high level executives who were participants in the various programs at the education center. It became necessary, as a matter of fact, to promote two people who had been within the Marriott organization at a much lower level, whose attitudes did fit the needs of the GTE Program Directors and to promote these people into positions for which they were literally technically not qualified, but we were able to overcome this through training exercises and through on-the-job training with others, including myself. This experience highlighted to me the importance of attitude as compared to the skill or technical or knowledge normally required in a position, and the program directors for GTE who were putting on the Executive Development Seminars were literally the guests, if you will, of the Marriott management team operating the GTE Education Center. From 1978 to 1987, I was the advisor to M.H.M., Inc., which is the largest contract management company within the hotel industry in the United States. Initially, in 1978 I took a leave of absence from Cornell University in order to establish a manpower development program for the company which would allow them to identify, select, train and promote from within the organization. As a result of this initial work with the company during the later years I was with the company as an outside consultant, on an annual retainer, | was able to work with many of the young A-5w , executives interspersed throughout the company’s hotel properties on a close, personal basis to assist them in ac- complishing their goals, which included operating the hotel on a management contract representing M.H.M. in a profitable manner for the owners. Time and time again, I have seen M.H.M. take over a property which had been operated by another management company, or by the owners themselves, and because of the way in which M.H.M. treated its employees and the manner in which M.H.M. executives briefed the em- ployees as to their benefits and as to what was expected of them, and as to what M.H-M. would do for them, I have seen the occupancy and revenues increase dramatically in hotels that had been operated previously by someone else who had not had the ability to generate the enthusiasm and the proper attitude within and among the employees and the departments within the hotel that would be so noticeable to the guests that they would want to come back to that same hotel on their next time in that town. As the only operations consultant to M.H.M. I was directly involved with many of the motivational training programs which M.H.M. did find was an absolute prerequisite to dealing with the employees before expecting them to accomplish any of their technical duties in operating the hotel. Therefore, I have seen many instances where the exact same hotel, the same location, the same flag (in other words was it a Hilton or was it a Holiday Inn), the same employees, and with no extensive renovation or money being placed into the property, change from an unprofitable operation to a profitable operation within a period of six to eight months. In my opinion, this was directly attributable to the attitude among the employees and the cooperation among the employees in servicing the guests, and the consensus among the guests (we did many surveys in this regard), that they did come back to this A-5x particular hotel because they liked the attitude and the way they were treated as a guest. During the period 1970 through 1980, I was the advisor to the Puerto Rico Industrial Development Company which owns 11 hotels in Puerto Rico and to the Tourism Department in Puerto Rico with regard to aspects of tourism and hotel operations on the Island. I have done complete analysis to include the market potential, the rates, the income, the expenses, the energy costs, the hotel operations (in an overall sense), union relations and estimates of net present values of various properties owned by the Puerto Rico Industrial Development Company and in all cases the attitude of the employees was probably the most important factor in our analysis and our findings and recommendations. We had thousands of questionnaires from tourists, visitors, conventioneers, and transient businessmen from which to obtain information and, without exception, the negatives involved the attitude of the Puerto Rican employee toward the guest —- as perceived by the guest. The impact of this information was so strong that the School of Hotel Administration at Cornell University agreed formally with the government of Puerto Rico to establish a joint venture school program in San Juan in order to begin to make inroads into the attitudes of the Puerto Rican youth who might be choosing the hotel industry as a career. From a technical and knowledge standpoint, the typical employee in the Puerto Rican resort hotels was extremely competent, yet the guest comments were very negative in a majority of the questionnaires because of the experience that the guest had had with a room clerk or with a food server or with a bellman, or with one of the engineers servicing a room, or with a doorman calling a cab. What came A-5y i enn across to the guest was an unpleasant experience rather than a lovely visit to a lovely Island — and all because of the tremendous attitudinal problems that existed on the Island at that time. The school at Puerto Rico, therefore, for years and years, and still does, emphasize motivation and human relations as much and more than emphasizing the technical aspects of the hotel operations business. All of us involved in this joint venture recognized it would be a long period of time before there would be any improvement in the attitude, if we could accomplish it at all. There has been some improvement during the early 1980's which we attribute to the school, but as yet the level of pleas- antness and services to the guest certainly has not reached the point that the Puerto Rico Industrial Development Company officials would like. “FACTS ESTABLISHING EXPERIENCE AT PORTMAN HOTEL - SAN FRANCISCO” I arrived at The Portman Hotel in San Francisco on Thursday, November 12, 1987, as a guest, and checked in the: normal and usual manner. This is my fifth day as a guest in the hotel and my wife and I have eaten meals in the hotel to include breakfast, lunch and dinner, and we have used room service on four different occasions. | was present when the personal valet made up the room on two occasions and had the opportunity to talk with both of those gentleman (one day was on a weekend and there was a different personal valet than during the weekday). Additionally, I had the opportunity to talk as a guest with employees from the guest services area which included both the front door porter and doorman and the reception personnel; I had a long talk with an engineer who was lighting the fireplace on Saturday evening when I was sitting there, I have had a chance to talk with food service personnel and with A-5z ee the room service personnel and, by coincidence, had quite a chat with one of the administrative assistants who was standing by to service a large influx of guests (175 check-ins on a Friday afternoon) as an assist to the usual guest services contingent. Additionally, I was officially given a tour of the entire property and met many of the management, supervisors, employees, and was able to talk with them during the tour with no one attempting to lead or to direct my questions or the employee's answers. Therefore with my experience and in analyzing properties, tied in with my 5-day stay as a guest, and my official tour of the complete building and the opportunity to talk to employees from all departments, I have been able to form some very definite opinions about the organizational structure and the reporting relationships which are currently in place in The Portman Hotel. “FACTS ESTABLISHING EXPERIENCE AT COMPARISON PROPERTIES:” In order to compare properly The Portman organization with those of some other luxury hotels in San Francisco, I made arrangements to visit with the Executive Assistant Manager (whom I had known well previously), and the Controller of the Four Seasons Clift Hotel, and talked with an assistant manager at The Stanford Court (a hotel that I had been very familiar with previously and, in fact, had been privy to all of their initial pre- opening training information and operating procedures). The tour through the Clift Hotel allowed me to talk with employees, and then on the second day of my visit to The Clift I was able to talk with two of the executives for several hours concerning organizational structure and work units and the like, in that both of the Executives had been students in my hotel operations class at Cornell University. This was a total discussion concerning A-5aa classical management versus job descriptions versus productivity versus synergism within an organization, and what organizational structure works best in attempting to operate a luxury hotel. My conversation with the assistant manager at the Stanford Court then confirmed what I had already known previously about the Stanford Court in its organizational structure, and the manner in which it is operated. Consequently, | I have been able to make a comparison concerning the organizational structure and the operating procedures which are currently in place at The Portman Hotel as ae to the other luxury hotels in San Francisco. “FINDINGS REGARDING THE PORTMAN HOTEL:” The operating procedures written prior to the opening of The Portman Hotel envisioned the property with employees working together as an intrinsic unit without any of the problems associated with “turf responsibility” being a factor in the operation of the property. In my opinion, this has already been accomplished and is in place at The Portman Hotel. There are many _____ examples that indicate the synergism and the esprit de corp that is present at The Portman Hotel and | shall cite several: during my tour, Mark Everton, the controller, was able to introduce me to almost every employee we met by name and to give a brief description of what he or she did and in each case the employee related well back to Everton in a team work type of attitude which is just not present in the normal work unit in today’s world. Everton, as a matter of fact, was able to discuss a problem the hotel is having with leaking showers with one of the engineers with whom we talked on my tour and the engineer obviously enjoyed talking on an equal one-to-one basis with the Controller of the Hotel and you could see and feel the camaraderie which was evident between these two gentlemen. A-Sbb a TT | Another example was the way that the fire room (called the Fireman’s Control Room) is administered and manned. Both the Security and the Property Management people must take care of this room and must assign someone to watch over it, but in case of emergency the Security representative immediately takes over until the Property Management Engineer who is in charge of the ' guest safety can get there until the fire department arrives. This is an exceedingly important example because it is not manage- ment here who is responsible for the guest safety in case of . emergency, but it is the Property Management Engineer as- signed person who takes over the room and is in charge, and it is the Security representative whose office is right next to the Fireman’s Control Room who takes over first and the co- ordination required between these two departments (i.e., Se- curity and Property Management), is very important to the working of this arrangement and to the safety of the guest. Another example of the truly integrated atmosphere that | en- countered at The Portman was the manner in which 175 in- coming guests were handled Friday afternoon and early evening. People from all Departments came down, ieft their own jobs, in order to assist the doorman, the porter and the guest services reception people to process this large influx (large for this size hotel) of incoming guests. Having the opportunity to talk with several of them while standing waiting for the guests, | qwas smitten with the complete feeling of teamwork and integrated atmosphere that permeated the entire situation. Another strong example of the synergism present in The Portman Hotel is the integration of the personal valet guest service personnel into the team as compared to the normal hotel organization where the housekeeping department is almost always female, and as such (for whatever reason) come in and make up the rooms and do not participate in other aspects of guest services. Whereas in The Portman the personal valet is the A-5cc contact for the guest to the rest of the hotel and particularly if something needs to be done within the room, the personal valet is able to accomplish it without having to fill out a work order to maintenance, to the engineering department, and wait to have it done. The engineers, in fact, are assigned to help the personal valets either by assisting them in doing something or by loaning them tools to accomplish first echelon maintenance such as fixing a drape or a valance which is in need of fixing, or to cover up a chip on the wall, etc.; and already I have seen evidence where the engineering department is integrated in the respect that not only do they encourage this to be done within the hotel, but they cooperate with other people who are on site in the guest rooms accomplishing things for the pleasure and the service of the guest; that the engineers themselves would be too busy to do. In the final analysis, nothing is more important than the satisfaction of the guest. The conversation I had with the engineer who was lighting the fireplaces in the lobby was very enlightening and he was an exceedingly articulate, self-assured gentleman who was talking to me as a guest, and was talking to me certainly as an equal. and a very comfortable equal, and telling me about the hotel and about how “Mr. Portman really wanted to have the guests have a decent experience sitting in the lobby, hence the fireplaces.” Had I been a guest who would be coming back to San Francisco time and again, this experience alone (i.e., having the opportunity to talk with an engineer who was articulate and who was concerned with my well-being as a guest and in keeping me informed as to the background of why something had been built) would certainly heighten my desire to come back to The Portman. A-5dd wae | Another example which is so different from what I am used to in the typical hotel organization included the interaction between an assistant auditor and the engineer who volunteered to help the assistant auditor learn how to use a tool and to be able to put in a secure fence down in the basement behind which could be stored key items. The engineering people were too busy to accomplish the job so one of the assistant auditors volunteered to do it and one of the engineers loaned him the tools with which to drill the holes in the concrete floor and showed him how to use the tool and offered to assist whenever he needed it if he got into trouble. Therefore, the assistant auditor was able to go ahead and put up a complete structure that would be secure for storing key items and the engineer department was able to go on with their tasks, but under normal organizational responsibilities, this job would have had to have been accomplished by an engineering department person, while some of the other important engineering tasks were held in abeyance while he accomplished this immediate project. At the present time there is no question that The Portman Hotel employees, even though they are organized in the departments, all have a common goal—which is the guest as the product of this organization. They are organized to produce this product, which is guest satisfaction and the loyalty of the guest which would cause the guest to return. There is no segregation or separation of departments with specific work duties or specific responsibilities or specific loyalties elsewhere which would interfere with this loyalty to The Portman Hotel as an organization that wants to make the guest experience a pleasant one which would cause him or her to return. From an academic point of view, the organization currently in place at The Portman Hotel can best be described as a modified matrix organization where persons have a supervisor in a normal sense of the word A-See cen and belong to a department in the normal organizational manner, but also report to others in a technical sense as needed (i.e., project directorships and getting specific acts accomplished fast). Matrix organizations came into being because of the need to accomplish the mission and change the organization quickly without regard to false organizational barriers between departments. It has especially been useful in large weapons systems procurement with the United States Government and large defense contractors, and without the matrix organization that deadlines imposed and that have normally been met would have been unrealistic deadlines because of the necessary organizational bureaucracy which is present in most organizations. The modified matrix organization at The Portman Hotel at this time is working, the employees have tremendous esprit de corp, the guest satisfaction is excellent, and without this type of satisfaction and this type of ambience that would please the guest there will be nothing to separate The Portman Hotel from the already established properties here in San Francisco, and it would be doubtful that The Portman would be able to break into that small market share well enough in order to survive. FINDINGS WITH REGARD TO THE COMPARISON HOTELS, ESPECIALLY THE CLIFT AND THE STANFORD COURT: The Clift and The Stanford Court are both very well managed and have exceedingly good reputations and yet are unable to have the freedom to react to some of the guest service needs as quickly as The Portman can at the present time because of the segregation of the departments and the specific job descriptions and barriers between the departments as to who and which department accomplishes which task. In fact, the work order board at The Clift Hotel was very typical of most A-5ff perry ee a 8 eT ET hotels wherein it was jam packed with small jobs that needed to be done to the various hotel rooms in The Clift, most of which could have been accomplished by someone not at the skill level and technical knowledge level of the engineers, yet because of the work rules it had to be accomplished by only a member of the engineer department and the work kept piling up and the engineer department, in spite of being a hard working conscientious crew, just had to get to those work orders as they ‘could. Consequently, there are guest rooms that are in need of small ‘first echelon maintenance that can not be done immediately as it can be at The Portman Hotel at this time. The organization assignment currently at The Clift and The Stanford Court is similar to what I have been used to in many many consulting situations and in many visits with my hotel operations classes to well-operated hotels, but still without the barriers imposed by specific segregated job related re- quirements, the hotels would be able to service the guest (i.e, which is really the organizational structure need is the guest service, in a much better manner). OPINION CONCERNING THE BARGAINING UNIT In my opinion, The Portman Hotel has planned for and has accomplished an organization structure which includes all of the employees integrated in a synergistic group which will accomplish the servicing of the guest in a manner which will make a guest want to come back. I believe that an examination of the esprit de corp of the employees would indicate that The Portman has been successful in this organizational structure, and that the employees are treated well (in fact they are even called “associates"), and that the employees feel not only that they belong to the hotel and they are proud of the hotel (reference, for example, the engineering member telling me as a guest about how wonderful the fireplaces were and what a good thought it A-5gg was by Mr. Portman), but the employees take pride in being a part of the team. My experience over many years leads me to the conclusion that any barriers brought about because of a segmentation of one department being unionized and the rest of them not would be to the detriment of the entire work force to include the engineering department. The success or failure of The Portman Hotel is important to each and every employee, whether he or she be unionized or not unionized, and the current organizational structure where the employees are free to cross boundaries and to perform other job tasks (ie., a true matrix organization) is the best way to accomplish the mission of _ ’ this property which is to produce a great guest satisfaction experience to bring the guest back again. There are many good hotels in this city, and if The Portman fails in its attempt to break into this luxury market, the employees will be injured whether they are unionized or not because as The Portman would be re- quired to cut down on the number of employees and try to re- duce its costs to keep in line with the revenues which would be less than anticipated in the original pro-forma, the service and the ambience would suffer, certainly the guest satisfaction would be lessened, but the end loser would really be the employees currently here in The Portman Hotel. This is a relatively small luxury hotel which needs the entire ambience and the total integration of the employees as a team in order to succeed. | believe the current organization where there is no segregation and no work barrier imposed between and among departments is the only way this hotel can survive. I swear under penalty of perjury that the foregoing facts are true and accurate to the best of my knowledge. Dated this 17th day of November. /s/Paul L. Guarnier A-5hh ; ’ is bine ‘ a ; » ‘ ' . -_ ad ~ . . , . . ~ . . ’ . — ’ —— — > P “ ‘ ‘ * ice tt nt ae i. 7 i . . ans iA ae a r ee wn “y “ oe, +, x 4 . : . , ir ot iain a , = pat) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385020_0562%3A2. Public record. Not legal advice.