Ho­tel’s own­ers dig in for la­bor fight

The reclu­sive Hsus, who op­er­ate the Hil­ton Los An­ge­les Air­port, take a strong, quiet stand against union ef­forts to or­ga­nize em­ploy­ees.

Los Angeles Times - - California - By Joe Mathews

On some days, Chris­tine Hsu scarcely sees the city whose po­lit­i­cal and la­bor lead­er­ship her fam­ily has up in arms. In­stead, she stays inside the Hil­ton Los An­ge­les Air­port, the ho­tel her fa­ther bought, the ho­tel his com­pany still owns, the ho­tel where she and her brother live for weeks at a time, 15 floors above Cen­tury Boule­vard.

The Hil­ton, with more than 1,200 rooms, is the sec­ond-largest ho­tel in Los An­ge­les County. Over the last year, it has be­come the pri­mary bat­tle­ground for one of the city’s loud­est dis­putes: a union or­ga­niz­ing cam­paign of a dozen air­port-area ho­tels.

The ef­fort by the union, Unite Here, has spawned other fights, in­clud­ing the city’s at­tempt to ex­tend so-called liv­ing wage pro­tec­tions to ho­tel work­ers and a boy­cott of the Hil­ton sup­ported by eight mem­bers of Congress, seven City Coun­cil mem­bers and a pres­i­den­tial can­di­date.

Last month, union pro­test­ers crit­i­cized the fa­mous “hug­ging saint,” a mys­tic from In­dia named Amma, for vi­o­lat­ing the boy­cott by hold­ing a spir­i­tual re­treat at the ho­tel.

Al­though the clash has been de­scribed as a con­test be­tween la­bor and busi­ness, or poor im­mi­grant ho­tel work­ers ver­sus cor­po­rate ho­tel own­ers, the cen­tral play­ers are the Hsus.

Union of­fi­cials claim the Hsus are the most hos­tile of air­portarea ho­tel own­ers to la­bor’s ef­forts to or­ga­nize. And, like the im­mi­grant work­ers the union seeks to rep­re­sent, the Hsus are from over­seas.

Hil­ton does not own the prop­erty. The Hsus hire Hil­ton to pro- vide man­age­ment and the cor­po­rate name.

The fam­ily is at once well­known and reclu­sive, iso­lated from South­ern Cal­i­for­nia and con­nected to prom­i­nent ath­letic and char­i­ta­ble or­ga­ni­za­tions.

Pa­tri­arch Henry Hsu (pro­nounced “shoe”) is 94 and lives in Tai­wan, where he has been a ma­jor sports, busi­ness and po­lit­i­cal fig­ure, but he main­tains church ties to Los An­ge­les and is listed in pub­lic records as chair­man of Uni­ver­sal For­tuna In­vest­ment Inc., the ho­tel’s par­ent com­pany.

His son, David, is For­tuna’s pres­i­dent and spends weeks at a time in the ho­tel, em­ploy­ees say. Henry Hsu’s daugh­ter Chris­tine also lives there and su­per­vises the fi­nances.

“It cer­tainly is a fam­ily busi­ness. Chris­tine ac­tu­ally lives in the ho­tel,” said lawyer Ed­ward Zaelke, who rep­re­sented the


[ Hsus in their 1992 pur­chase of the ho­tel. “They are salt-of-theearth peo­ple.”

Ac­quain­tances say the Hsus also share key traits: stub­born­ness and a his­tory of pur­su­ing fights for years with­out giv­ing ground.

In Los An­ge­les, that pat­tern is re­cur­ring.

Through­out the fight, the Hsus have main­tained a pub­lic si­lence. Through a lawyer and a pub­lic re­la­tions con­sul­tant, they de­clined to be in­ter­viewed or to an­swer writ­ten ques­tions from The Times.

Fam­ily mem­bers did not re­spond to re­peated phone mes­sages left for them in Los An­ge­les and Taipei.

“They’ve never talked to the me­dia, and they’re not go­ing to start now,” said Har­vey Eng­lan­der, the con­sul­tant, who said he had never met the Hsus.

For most of the last year, ho­tel man­agers and spokes­men have is­sued state­ments ac­cus­ing politi­cians and Unite Here or­ga­niz­ers of ly­ing about the ho­tel and de­mand­ing union­iza­tion with­out a vote of work­ers.

One state­ment said the union and city coun­cil­men who sup­port its ef­forts are “de­lib­er­ately hurt­ing our em­ploy­ees’ way of life.”

The own­ers of other air­port ho­tels say they have had lit­tle con­tact with the Hsus, who pre­fer to com­mu­ni­cate through their Hil­ton man­agers.

“We have tried to com­mu­ni­cate with them, but we have not been able,” said Michael Gal­le­gos, chief ex­ec­u­tive of Amer­i­can Prop­erty Man­age­ment Corp., which owns the Sher­a­ton Four Points. Like the Hsus, he op­poses union­iza­tion, but he has backed the liv­ing wage leg­is­la­tion that the Hsus fought.

Elia Roan, a For­tuna En­ter­prises part­ner whose fam­ily has been close to the Hsus for years, says they of­fer lit­tle in­for­ma­tion on the ho­tel, in­clud­ing dur­ing an­nual meet­ings in Los An­ge­les. Roan said she had not been made aware of the union or­ga­niz­ing ef­fort.

“My fam­ily is close,” Roan said. “And their fam­ily sit­u­a­tion is closer than mine.”

The Hsus have been hurt by the crit­i­cism, par­tic­u­larly the sug­ges­tion that they are hos­tile to im­mi­grant work­ers, said Paul Szeto, pres­i­dent of a Mon­terey Park-based Chris­tian min­istry the Hsus have sup­ported.

“They are im­mi­grants help­ing im­mi­grants,” Szeto said of the Hsus. “They re­ally want to help the peo­ple, the staff. And they them­selves live fru­gally. They save. They don’t waste. It’s a very Chris­tian kind of liv­ing.”

Long ca­reer

When Henry Hsu bought the Hil­ton in 1992 for $45 mil­lion, the pur­chase ap­peared to cap a long ca­reer for a renowned Tai­wanese busi­ness­man, leg­is­la­tor, sports­man and phi­lan­thropist.

Born in China to par­ents who were doc­tors, Hsu had planned to be a doc­tor him­self un­til his mother was killed in a ho­tel fire when he was 18, he said in an oral his­tory project that was ob­tained and trans­lated by The Times.

Hsu’s fa­ther had stud­ied in the United States. Henry Hsu com­peted in­ter­na­tion­ally in nu­mer­ous sports, in­clud­ing bas­ket­ball and vol­ley­ball. He grad­u­ated from naval col­lege, earned a law de­gree and later at­tended the U.S. Naval Train­ing Cen­ter in Mi­ami.

More than 6 feet tall, Hsu later boasted that he had been “the tallest man in the Chi­nese navy,” one friend re­called.

Posted to Hong Kong dur­ing the Ja­panese at­tack in 1941, he helped hun­dreds of peo­ple es­cape, in­clud­ing Bri­tish sol­diers. In 1942 King Ge­orge VI named him an hon­orary of­fi­cer of the Or­der of the Bri­tish Em­pire.

Af­ter the com­mu­nist takeover of China in 1949, Hsu fo­cused his busi­ness ca­reer on Hong Kong.

He in­vested in real es­tate and started a travel agency. That led him to the ho­tel busi­ness.

He was a ma­jor­ity share­holder in the lux­u­ri­ous Ho­tel For­tuna in Hong Kong, serv­ing as chair­man. He sold the ho­tel and other Hong Kong as­sets in 1981 and moved to Tai­wan, telling a news­pa­per he feared what the com­mu­nists would do af­ter Bri­tain handed over Hong Kong to China in 1997.

He had rea­son to dis­trust the Chi­nese gov­ern­ment. He had done bat­tle with it for decades in one area that was close to his heart: the Olympics.

In 1959, the In­ter­na­tional Olympic Com­mit­tee, rec­og­niz­ing the rise of com­mu­nist China, said Tai­wanese ath­letes could no longer com­pete un­der the name China.

Hsu fought that de­ci­sion and won, for a time. But in 1976, Cana­dian Prime Min­is­ter Pierre Trudeau, who was close to Bei­jing, ef­fec­tively ex­cluded Tai­wanese ath­letes from the Mon­treal Games.

In re­tal­i­a­tion, Hsu aban­doned an in­vest­ment in Van­cou­ver and vowed never to put money into Cana­dian prop­er­ties, ac­cord­ing to pub­lished re­ports — a prom­ise he has kept to this day.

Hsu, by then a mem­ber of the In­ter­na­tional Olympic Com­mit- tee, took the ex­tra­or­di­nary step of su­ing the Olympic move­ment in in­ter­na­tional court. Some IOC mem­bers wanted him re­moved, but Hsu’s le­gal gam­bit helped force a com­pro­mise. In 1981, Tai­wan and the IOC agreed to al­low Tai­wan to com­pete as “Chi­nese Taipei.”

“Henry fought a dis­tin­guished and classy bat­tle against pretty over­whelm­ing odds for a num­ber of years,” said Dick Pound, a long­time IOC mem­ber from Canada.

Build­ing churches

It was char­ity work that first con­nected Hsu to Los An­ge­les.

While liv­ing in Hong Kong, Hsu be­gan at­tend­ing ser­vices run by Evan­ge­lize China Fel­low­ship, an in­ter­de­nom­i­na­tional Chris­tian group based in Mon­terey Park. Hsu later helped Evan­ge­lize China build a church in Hong Kong and or­phan­ages around the world.

He sup­ported ef­forts to dis­trib­ute Bibles across the globe — a nat­u­ral for a de­vout Chris­tian hote­lier — and for a time served as pres­i­dent of the Tai­wanese arm of the Red Cross.

“I feel I am a very lucky per­son, and this luck was given by God,” he said in the oral his­tory. “I rarely fail any­thing I do. Those things that couldn’t be ac­com­plished by oth­ers, I fin­ished them suc­cess­fully.”

Though Hsu’s three chil­dren have not matched his promi­nence, he put two — David and Chris­tine — in charge of the Hil­ton. David “is more tal­ented in busi­ness than I am,” Henry said in the oral his­tory.

Ho­tel em­ploy­ees say the sib­lings oc­ca­sion­ally throw par­ties at the ho­tel for friends but oth­er­wise keep to them­selves and have few ex­changes with work- ers.

“It’s just ‘hi’ and ‘bye,’ ” says Miguel Var­gas, 34, a waiter who has worked at the ho­tel for 15 years and has seen more of the Hsus than most em­ploy­ees. “They come down to the restau­rant for break­fast, lunch and din­ner. But we don’t talk, and def­i­nitely not about what’s go­ing on with the union.”

Af­ter buy­ing the Hil­ton, the Hsus re­duced the staff from 800 to about 400, ac­cord­ing to the oral his­tory. (The num­ber ap­pears to have since re­bounded to more than 600, ac­cord­ing to in­dus­try es­ti­mates.) Henry Hsu also spent $25 mil­lion to re­model the ho­tel com­pletely.

The Hsus have few deal­ings with pub­lic of­fi­cials. Coun­cil­man Bill Rosendahl met with David Hsu dur­ing the re­cent tur­moil, but Rosendahl says the meet­ing was “off the record.” By con­trast, the Zen fam­ily, known best for its stew­ard­ship of the Westin Bon­aven­ture, has been an ac­tive player in city pol­i­tics.

“In the Chi­nese Amer­i­can com­mu­nity, they’re not re­ally vis­i­ble at all,” said for­mer City Coun­cil­man Mike Woo, whose fa­ther has been a friend of Henry Hsu. “They didn’t come up through the com­mu­nity. They came in as over­seas buy­ers.”

De­spite their iso­la­tion — per­haps be­cause of it — the Hsus have proved to be a dif­fi­cult foe for the union.

In Los An­ge­les and other cities, Unite Here has used an or­ga­niz­ing for­mula that re­lies heav­ily on pub­lic pres­sure, crit­i­ciz­ing ho­tel own­ers un­til they agree to let the union or­ga­nize work­ers with­out in­ter­fer­ence or fed­er­ally su­per­vised elec­tions. But the Hsus have been un­moved by the cam­paign or pub­lic crit­i­cism.

“They need to know the union is go­ing to back those work­ers as long as it takes,” says Bruce Raynor, gen­eral pres­i­dent of Unite Here.

The ho­tel is ready for a long march as well. David Hsu has told as­so­ciates that he feels Unite Here can be forced to re­treat, much as the Team­sters gave up af­ter an or­ga­niz­ing cam­paign at the ho­tel in 1998.

The Hsus have hired Lupe Cruz, a for­mer Unite Here or­ga­nizer, to fight the or­ga­niz­ing ef­fort. Fed­eral fil­ings show that the ho­tel paid Cruz & As­so­ciates more than $480,000 last year.

While other ho­tels have ig­nored at­tacks by the union, the Hil­ton has re­sponded in kind.

Ho­tel em­ploy­ees have been brought for­ward by Hil­ton to ac­cuse the union of ha­rass­ment, van­dal­ism of their ve­hi­cles and vis­its to their homes that made them un­com­fort­able.

In 2006, ho­tel man­agers sus­pended more than 70 work­ers for a week af­ter they gath­ered in the cafe­te­ria to protest the fir­ing of an em­ployee who was ac­tive in the union ef­fort. The em­ployee had been caught steal­ing by a “mys­tery shop­per” em­ployed by the ho­tel to im­per­son­ate a guest, ho­tel of­fi­cials said.

The next day, City Coun­cil­woman Jan­ice Hahn and a ho­tel se­cu­rity guard had a phys­i­cal col­li­sion as she tried to walk into the ho­tel with some of the sus­pended work­ers.

Hahn claimed she was man­han­dled. A ho­tel se­cu­rity video­tape ap­pears to show Hahn hit­ting a guard with her el­bow. The guard filed a bat­tery com­plaint with the Los An­ge­les Po­lice De­part­ment. No charges have been filed.

When the City Coun­cil, led by Hahn, voted to ex­tend the liv­ing wage of $10.64 per hour to Hil­ton work­ers last fall, a Hsu fam­ily com­pany do­nated $235,000 to an ef­fort to qual­ify a bal­lot ref­er­en­dum to re­verse the new law.

The coun­cil later passed com­pro­mise leg­is­la­tion to avoid a ref­er­en­dum vote, but that law was thrown out in Su­pe­rior Court this spring; the city is ap­peal­ing.

Al­though the Hsus have thus far avoided the ap­pli­ca­tion of the liv­ing wage, their op­po­si­tion to that leg­is­la­tion and to union­iza­tion has come at a cost.

Unite Here has led a boy­cott for al­most a year. Ac­cord­ing to boy­cott or­ga­niz­ers, 19 ho­tel clients have pulled out, in­clud­ing the Cal­i­for­nia Teach­ers Assn. The union says the boy­cott has cost the ho­tel more than $3 mil­lion in lost busi­ness. The ho­tel, in a state­ment, said “the im­pact, if any, has been min­i­mal.”

The union has made the area in front of the ho­tel the main stage for ac­tions about how work­ers are treated.

Last fall, the union helped put to­gether a mas­sive demon­stra­tion in front of the ho­tel that saw the ar­rests of some 300 pro­test­ers. In a state­ment, the ho­tel said it treats em­ploy­ees re­spect­fully.

And this spring, Unite Here helped stage a Good Fri­day re­li­gious ser­vice in front of the ho­tel, with a reen­act­ment of the cross­ing of the Red Sea. Union of­fi­cials said they asked pas­tors friendly to their ef­fort to reach out to the Hsus, to no avail.

For now, the union and the Hsus re­main at odds.

But the Hsus would seem to have the re­sources for a long fight. Alan Reay, pres­i­dent of At­las Hos­pi­tal­ity Group, a con­sult­ing and bro­ker­age firm, es­ti­mates that the Hil­ton has an­nual rev­enue of about $50 mil­lion.

If the Hsus were to sell, they would prob­a­bly turn quite a profit. Pub­lic records and in­dus­try es­ti­mates put its value at ap­prox­i­mately $150 mil­lion — more than three times what they paid for it 15 years ago.


Anne Cu­sack Los An­ge­les Times

UNION EF­FORT: Hil­ton Los An­ge­les Air­port work­ers Jose Molina, left, and Jose Gar­cia read a union flier dur­ing a break.

Anne Cu­sack Los An­ge­les Times

PROTEST: Kristin Reeg, left, and Samuel Pullen sing at a rally last month at the Hil­ton. The union Unite Here says the boy­cott has cost the ho­tel more than $3 mil­lion in lost busi­ness. David Hsu, whose fa­ther owns the ho­tel, has said that Unite Here...

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