NEGOTIATING STRATEGIES: John Foster (left) said: “If
you ask for something from the other side before a con- tract exists, it’s called negotiating; if you ask for something after a contract exists, it’s called begging.” Audra Heagney recom- mends that planners con- sider employing several tactics in contract negotia- tions to reduce or prevent attrition fees, which are “often overlooked or underestimated.”
the explanation more than 20 years ago on why longer contracts are better: If you ask for something from the other side before a contract exists, it’s called negotiating; if you ask for some- thing after a contract exists, it’s called begging.
Heagney: Attrition fees are often overlooked or underestimated. It is difficult to accurately estimate attendance for an event hap- pening five or 10 years from the contract date, but there are several tactics that meeting planners might consider employing in contract negotiations to reduce or prevent these attrition fees. First, consider trying to negotiate a contract in which penalties are not assessed for attrition. If the hotel will not agree to that, a provision should be included that permits review and reduc- tion of the room block at a date closer to the event date, with no penalties incurred for such reduction. All attrition fees should then be based upon the reduced room block.
At This Year’s Hospitality Law Conference
Now in its tenth year, the Hospitality Law Conference focuses on the latest trends and issues in hospitality law, safety, and security. In advance of this year’s meeting—held at the Omni Houston Hotel on Feb. 8–10—Stephen Barth, J.D., attorney and founder of HospitalityLawyer.com, which produces the conference, previewed some of the topics that would be discussed.
Risk management: “How do you assess a hotel’s security record? What steps are hotels taking to provide enhanced security? Some examples are training staff not to call out a room number, not to give out a guest-room number over the phone, making sure the key-control system is secure and access is limited, and conducting better background checks on employees.
“A big issue is room service. When you order breakfast
and put the menu out on your door, you are announcing that there’s only one person in the room and you are expecting someone to show up at 6:30 a.m. If a bad guy comes to the door and takes the menu, you have no idea that the hotel didn’t pick it up. So when there’s a knock at the door at 6:30 a.m., you open it because you’re expecting room service ... and the bad guy is standing there. “Meeting planners should put together an awareness-
raising piece for attendees—be aware of your surroundings at a resort or hotel, only take approved taxi cabs and car services, make sure someone always knows where you are going, don’t leave your name and room number on a list for everyone to see at the spa or gym.”
Alcohol liability. “Alcohol is a huge issue. It becomes very
Also, consider negotiating attrition based on cumulative room
nights rather than each night. As with cancellation, a provision should be included in the meeting contract requiring the prop- erty to undertake reasonable efforts to resell unused rooms and apply any such revenue against any attrition damages owed by the organization. This duty to mitigate damages should also be applied to any attrition in guaranteed food-and-beverage amounts. In addition, a provision should be included in meet- ing contracts that allows the organization to get credit for rebook- ing or providing alternate business to the hotel.
Howe: In contracts, what is often overlooked is what I call the ripple effect. Say you enter into an addendumor rider, and one of the things you do is reduce the roomblock for purposes of attri- tion, ... and then you cancel the meeting. But you’ve failed to take into consideration the impact of reducing the room block on can-
pcma convene March 2012