The hospitality industry is under increasing pressure from a dramatic shift in US government strategy to enforce existing illegal immigration law. While a new federal immigration policy remains elusive, what practical options are available to hospitality employers who seek to build a strong, tenured — and legal — workforce? One promising alternative: transformative HR practices.

When restaurant giant Chipotle Mexican Grill announced this month that it wasn’t quite ready to change recruiting practices, the company was justifiably coy.

Leadership at the chain, which operates 1,100 restaurants in 33 states and Canada and employs 25,000 was reacting to an announcement by the US Department of Homeland Security’s Immigration & Customs Enforcement division (ICE) that it was expanding an investigation of the restaurant company’s records that verify whether an employee is legally authorized to work in the US. An ICE inquiry last year led Chipotle to terminate the employment of hundreds of its employees in Minneapolis.

Chipotle’s troubles with I-9 verification are hardly unique. Last December a New Hampshire restaurant owner pleaded guilty to one count of “engaging in a pattern or practice of recruiting or hiring illegal aliens unauthorized to work in the United States” according to a statement from the Department of Homeland Security. The criminal charges were based on the employer hiring 18 undocumented employees to work in Dunkin Donuts shops over a period from 2001 to 2009.

In a case that drew national attention¹ a San Diego restaurant operator was indicted by a Federal grand jury and faces forfeiture of his restaurant property after a Federal grand jury alleged he continued to employ illegal immigrants after learning the employees were in the country unlawfully. “They’re using a body of law intended for drug dealers and money launderers,” said California Restaurant Association head Jot Condie referring to Federal authorities. “If their strategy is to get the attention of the industry, mission accomplished.”

The E-Verify system, currently the primary tool available to employers to check a job applicant’s green card or Social Security status, has several basic structural flaws, say experts, and thus far has failed to gain widespread use. The Migration Policy Institute reports² that as of October 2010 E-Verify was in place at a mere four percent of employers nationwide. Even where individual states have mandated use of E-Verify (Arizona, Mississippi, South Carolina and Utah), MPI found for example that only 31% of Arizona employers had actually registered with the Department of Homeland Security, the first step to enabling the E-Verify mechanism; the other states had significantly lower sign-up rates.

What should employers do to break the pattern of hiring those whose employment authorization may be questionable?

Hire only American citizens or those with green cards. This sounds easy enough; however, in most cases employers may not legally specify a preference for a particular nationality of employees nor may they specify specific employment authorization documents they will accept.

Raise wages and benefits to attract more legal residents. If a rise in wages is unaccompanied by robust efforts to expand an employer’s hiring pool to attract greater numbers of legally-authorized employees, employers may see reduced productivity.

Enroll in E-Verify. Until employers are convinced the advantages outweigh the negatives, voluntary use of E-Verify likely will remain suppressed. And without concomitant programs to draw in more legally authorized applicants, use of E-Verify may only exacerbate an already problematic applicant flow. In other words, E-Verify may at best solve only part of the employer’s recruitment challenges.

A just-released study by the Cornell Center for Hospitality Research³ in which the innovative HR practices of three hospitality companies are lauded, may offer a way forward for employers who want to remold their workforces by expanding the demographics of their applicant pool. The study reports on how Fairmont Hotels, McDonalds and Sodexo each managed to raise employee satisfaction and retention – and in Sodexo’s case, add dramatically to its list of those interested in employment.

Fairmont was cited for celebrating employee achievements and breaking down barriers to communication by giving employees the freedom to send one another “Bravograms” for creative guest service. At McDonalds, a franchisee discovered a creative way to marry the chain’s vaunted People Promise HR philosophy with a sales incentive program, while at Sodexo the company reinvented its social media policy by using Twitter, Facebook and YouTube to explain why a job at Sodexo is a rewarding experience; its program attracted legions of interested job applicants – 160,000 of them.

The success the Cornell-cited employers have experienced include (1) the essential need to create new, transformative HR policies to acknowledge a changed workforce, and (2) these new policies must be adopted and consistently applied across the organization. A persuasive argument for these transformative practices can be found in The Corporate Lattice, an article⁴ appearing in the February 2011 edition of Talent Management.

Adding to what is known about the new generation of employees, a 2008 article in 4Hoteliers ⁵ by coach and training expert Bea Fields made a strong case for hotel employers to transform their existing recruiting/retention programs using ten areas of focus. The authors’ contention is that broad changes in demographics have already led to a generational shift in the meaning of work. What was “work is a place you go to” is becoming “work is what you do,” suggesting a workplace where employees are comfortable because their needs are met, including a successful marriage of career and life.

Hospitality employers who commit to transforming their HR policies might consider these potential questions from prospective applicants for entry-level positions: Could a dishwasher in your hotel also spend time learning how to be a reception clerk? Do you offer English classes? Could I work part of my day as a bus person and part as a host? If I accepted your job offer as cook, could I take a class the company offers in learning how to become a reception clerk? Do you have a Wi-Fi hot spot? Is there an employee lounge?

By offering an employee-focused working environment that favors job rotation, programs for community involvement, a place to network, and an online component such as an employer Facebook page where employees can share their job experiences, hospitality employers are putting out a “welcome” sign for job applicants who have heretofore eschewed an entry-level job in the industry.

If the experiences of Fairmont, McDonalds and Sodexo signal a way forward, an industry-wide commitment to transformative HR practices would attract a whole new workforce and hopefully, a “wind assist” from the media that hoteliers, restaurateurs and employers from throughout the travel and tourism industry would applaud.

¹ Kershaw, Sarah. Immigration Crackdown Steps Into the Kitchen. The New York Times. September 7, 2010 http://www.nytimes.com/2010/09/08/dining/08crackdown.html

² Rosenblum, Marc R. E Verify: Strength, Weaknesses and Proposals for Reform. Migration Policy Institute. February 2011. http://www.migrationpolicy.org/pubs/E-Verify-Insight.pdf

³ Sun, Justin and Walsh, Kate. Implementing Human Resource Innovations: Three Success Stories from the Service Industries. Cornell Center for Hospitality Research, Vol 11, No 3. February 2011. http://www.hotelschool.cornell.edu/research/chr/pubs/reports/2011.html

⁴ Benko, Cathy and Liakopoulos, Andrew. The Corporate Lattice. Talent Management. February 2011.

⁵ Fields, Bea. 10 Strategies for Attracting Generation Y as Employees Into Your Company. 4Hoteliers. October 29, 2008. http://www.4hoteliers.com/4hots_fshw.php?mwi=3465

Charles Conine

Cayuga Hospitality Advisors member  Chuck Conine is a graduate of the Cornell University School of Hotel Administration and a certified Senior Professional in Human Resources. He led HR teams in hotels, restaurants and foodservice for 35 years and is currently president of Hospitality HR Solutions; Conine also serves as Group Leader: HR/Employee Relations at Cayuga Hospitality Advisors. He is a commissioner at Palm Springs International Airport and his monthly columns on human resources trends in the hospitality industry appear in the Smith Travel Research publication “Hotel News Now.”

Cayuga Hospitality Advisors
www.cayugahospitality.com