Trouble in Paradise: Hawaii’s Hotel Strike

by Rowena Itchon, Pacific Research Institute, December 6, 2018

I just returned from my annual Thanksgiving family trip to Hawaii where it was Day 40-something of a hotel workers’ strike at the Royal Hawaiian Hotel.  I had a hunch something was amiss when our Uber driver pulled into the driveway and a lone young woman who weighed about 100 pounds opened the trunk of the car and dragged out our three full-sized suitcases.  Then an elderly gentleman who could have been with the hotel since 1927 greeted us with leis.  They both walked away without waiting for a tip.

The strike affected five hotel properties in Hawaii and was part a larger strike by Marriott workers in Detroit, San Jose, San Diego, Oakland, San Francisco, and Boston.  All have ended except for San Francisco, where more than 2,500 Marriott workers remain on strike.

Along with the Hawaiian sunrise, hotel guests were greeted each morning with drum-beating, bull-horn wielding chanters, even to the tune of Christmas music (is anything off-limits anymore?).  It’s hard not to feel sorry for the Japanese couples who were holding their wedding ceremonies at the hotel, or the many retirees and families who perhaps saved months if not years for their vacation.  Having a dispute with your employer is one thing, but why should others who had no part in it suffer?

Management tried to make the best of it.  A man who was bussing tables told me he was flown in from another property where he directed beverage service.  I tried to make him feel better – it’s Waikiki after all and the weather is beautiful.  He said that he came from the famed Phoenician in Arizona, which he thought was just as beautiful, and the weather in Phoenix is never better than this time of the year. And he missed his family.

On Day 51 (sadly, a few days after I left), the strike ended.  In a statement released by Unite Here Local 5, the new contract included job security; reductions in subcontracting of staff positions; worker involvement in technology deployment; a child/elder fund; a reduction in workload for housekeepers; an increase in wages, an increase in pension contributions; and an increase in health and welfare contributions.

The strikers gave up 51 days of pay to achieve the above. But why did union workers have to strike at all? Why are workers struggling in Hawaii?  Consider Hawaii’s ranking in this year’s Economic Freedom Index by the Fraser Institute.

Keli‘i Akina, president of the independent Grassroot Institute of Hawaii, said that “On a 10-point scale, with 10 being the most free, Hawaii’s index score for economic freedom for 2018 dropped from 6.3 in 2017 to 5.48. Hawaii scored worst in the nation for sales tax revenues because of its general excise tax. It also tied for 49th with Minnesota for the top marginal income tax rate.  Increases in minimum wage laws and union presence lowered Hawaii’s score for “Labor Market Freedom” to 44th, from 29th in 2017. According to the Grassroot Institute, high taxes, high government spending and burdensome regulation were major reasons economic freedom in the state continued to decline; they also contributed heavily to the state’s high cost of living.

Hawaii ranked 37th overall.  The good news, Akina said, was that the Index provides a road map to freedom and prosperity: “It’s all there: Trim government regulations, reduce our infamous tax burden, expand labor market freedom, and more.”

Meantime, the San Francisco hotel strike continues.  And it’s no wonder. California at #47 scraped the bottom of the Index.

---30---

Rowena Itchon is senior vice president at the Pacific Research Institute