Owner of Pan Pacific Vancouver and other hotels collected $34 million in U.S. Paycheck Protection Program Loans despite eliminating staff; echoes Westmont’s use of Canada Emergency Wage Subsidy, concerns over unchecked use of COVID-related government subsidies and loans
VANCOUVER, BC – UNITE HERE Locals representing hotel workers in British Columbia, Southern California, and Arizona are demanding that the U.S. Government halt loan forgiveness for $34 million in Paycheck Protection Program (“PPP”) loans connected to Westmont Hospitality. In a letter to the U.S. Small Business Association, the Locals request an investigation into 35-Westmont connected loans, and question how many of their 4,024 reported employees tied to the loans were terminated.
Westmont took advantage of a loophole that enabled large hotel chains to apply for forgivable loans originally intended for small businesses to return workers to payroll. Westmont claims to be one of the largest privately held hospitality organizations in the world, holding an ownership interest in and operating over 500 hotels. The U.S. Small Business Administration (“SBA”), which oversees the PPP, has already forgiven one loan tied to the firm’s corporate office in Houston.
PPP borrowers were required to spend 60% of PPP loan proceeds on payroll costs to qualify for full loan forgiveness, but the SBA has not disclosed how Westmont has used its PPP loans. In the U.S., a Westmont-owned hotel obtained two PPP loans tied to the Hyatt Regency Jacksonville in Florida worth $5.49 million. WARN notices filed by the hotel indicate 121 workers were terminated.
The letter asks whether Westmont received any loans connected to the Pan Pacific Vancouver in British Columbia. The hotel fired approximately 100 long-term workers during the pandemic and induced remaining workers to sign away their full-time status and severance rights. Westmont, headquartered in Mississauga, owns Pan Pacific Vancouver, Fairmont Waterfront and co-owns the JW Marriott Parq Vancouver and The Douglas, and controls dozens more hotels across North America.
The largesse from the U.S. Government prompts questions over how much Westmont has received in public subsidies from Canada’s federal wage subsidy program (CEWS) and in government-backed loans through the Highly Affected Sectors Credit Availability Program (HASCAP). Although Westmont affiliates tied to Pan Pacific Vancouver and Fairmont Waterfront tapped CEWS, both hotels terminated long-term staff during the pandemic contrary to the intent of the program.
Westmont may also benefit from the newly launched federal hiring subsidy, the Canada Recovery Hiring Benefit (CRHP), and the Tourism Relief Fund which provides tourism operators with up to $500,000 in funding. The Trudeau government has not required public reporting of amounts received by individual businesses for COVID-related subsidies or government-backed loans to ensure programs are not abused.
Zailda Chan, President of UNITE HERE Local 40, said: “Westmont Hospitality has reaped millions in taxpayer relief from the U.S. and Canadian governments while turning their backs on their employees during the pandemic. Hotel employers should not be rewarded for eroding the jobs of their workers, primarily women and racialized people, on the government’s dime. How much longer should taxpayers across our two nations support Westmont while their workers fall through the cracks?”
UNITE HERE Local 40 represents workers at Pan Pacific Vancouver. UNITE HERE Local 11 represents workers at Westmont-operated Hilton Hotel & Suites in Santa Monica and westdrift Manhattan Beach in California.
Contact: Michelle Travis, [email protected], 778-960-9785