Asian Hotels has come under fire since the closure of operations at Hyatt Regency on June 7. Since then, all independent directors on the board of the company have quit.
A labour court has ruled that the decision of Hotel Hyatt Regency to halt its operations in Mumbai is “illegal” under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices (MRTU and PULP) Act, 1971.
“It is held and declared that respondents (Hotel Hyatt Regency) have engaged into unfair labour practice under Item 6 of Schedule II and Item 9and 10 of Schedule IV of MRTU and PULP Act 1971. Respondents are directed to cease and desist from the same,” said an order passed by SV Suryawanshi, member of the Industrial Court in Mumbai, on September 30.
On June 7, the management of the five-star hotel said the hotel will remain closed till further notice, since its parent Asian Hotels (West) Ltd is not making payments for its salaries and operations. Following the shutdown, 200-odd employees of the hotel approached the industrial court and labour commissioner seeking protection from termination.
These employees of the hotel are part of Bhartiya Kamgar Sena, a workers’ union affiliated with the Shiv Sena. Union secretary Manoj Dhumal said, “The labour court has ruled in favour of the employees and asked the hotel to pay its employees.”
The labour court has directed Asian Hotels (West) to “provide work and/or wages to the concerned workers so far as they are in the employment including arrears of earned wages from time to time”. It has also “restrained” Hyatt Regency and Asian Hotels from disposing of or creating third interest on the properties owned by them.
Hyatt is an American hospitality company that manages and franchises luxury and business hotels. It is managing the Mumbai property on a contract basis on behalf of Asian Hotels (West).
After the shutdown of its hotel in June, Asian Hotel in a statement said that the hotel management had to make the unprecedented move of temporarily shutting down Hyatt Regency in Mumbai because Yes Bank Ltd, with which it maintains an account, has blocked that account and held back all funds after a default in loan repayment. Asian Hotel had said it defaulted on repayment due to a severe liquidity crunch since the beginning of the Covid-19 pandemic.
Earlier this week, The Indian Express reported that Yes Bank has taken possession of Hotel Hyatt Regency building after Asian Hotels defaulted on loan repayment of Rs 267 crore.
Asian Hotels has come under fire since the closure of operations at Hyatt Regency on June 7. Since then, all independent directors on the board of the company have quit. In September, the auditor of the company resigned, according to a notification by the company to the stock exchanges.
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