Hotel union calls terms of deal for Luxe Rodeo Drive into question

Unite Here Local 11 says Harkham family violated successorship terms on sale to LVMH

Los Angeles /
Jan.January 31, 2022 03:00 PM
(L-R) Beverly Hills-based hotelier Efram Harkham, LVMH CEO Bernard Arnault and Unite Here Local 11 president Kurt Petersen with 360 N Rodeo Drive (Harkham, LMVH, Favebook via Unite Here Local 11, Loopnet)

A month after LVMH bought the Luxe hotel on Rodeo Drive, hospitality union Unite Here Local 11 has called the terms of the deal into question by filing a complaint with the former owner.

Unite Here Local 11 has filed a formal grievance, claiming the Harkham family, who formerly owned the hotel, failed to satisfy certain successorship provisions of a labor agreement with the union.

Under a collective bargaining agreement between the local union and Luxe Rodeo Drive, LVMH was required to assume the agreement, meaning it would continue operating the hotel with the same union provisions in place, according to documents seen by TRD.

Beverly Hills-based hotelier Efram Harkham, as the former owner of Luxe Rodeo Drive, was required to notify the union that LVMH had assumed the CBA. Unite Here Local 11 president Kurt Petersen said the union has not heard from either party.

Harkham could not be reached for comment. LVMH did not respond to a request for comment.

LVMH purchased the hotel for $200 million at the end of last year, sources familiar with the deal told TRD at the time. The 42,560-square-foot property at 360 North Rodeo Drive also includes three high-end retail storefronts leased to Rolex, Patek Philippe and Ferrari.

The 86-key hotel has been shut down since September 2020. At the time, Efram Harkham’s son, Aron Harkham, said that the property got “caught up with the bad timing of the global travel market.” At the same time, the firm terminated all of its employees, according to the union.

Under California’s Senate Bill 93, signed into law in April 2021, employers in the tourism and travel industries have to rehire all employees who were laid off during the pandemic when operations restat.

It’s unclear whether LVMH plans to reopen the property as a hotel. The house of luxury brands has not filed any plans for redevelopment with the city of Beverly Hills.

Unite Here has asked lawyers representing the Harkhams to move the complaint to arbitration and for a hearing to be scheduled “as soon as possible,” according to the grievance.

The Harkham family has until Wednesday to respond to the union’s grievance and provide documents related to the sale of the hotel to LVMH.





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