Pennsylvania Restaurant & Lodging Matters by Graphtech

SUMMER 2013

ProStart PAID

HARRISBURG PA PERMIT NO. 533

PRSRT STD U.S. POSTAGE

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Developing the best and brightest talent

Security Protocols Restaurant Supplier Contracts Is the small print SMALL for a reason?

ProStart®

PRLA 2013 Officers CHAIRMAN Matt English Milestone Hospitality Management LLC, Lancaster Central and Lancaster Chapters

ProStart trains students on industry-specific skills that can be used in all aspects of the restaurant and foodservice industry.

VICE CHAIRMAN Mike Rodden Philadelphia Marriott West, West Conshohoken Philadelphia Delaware Valley Chapter VICE CHAIRMAN Rick Sell Bahama Breeze, Exton Philadelphia Delaware Valley Chapter TREASURER Jeff Cohen Smallman Street Deli, Pittsburgh Western Chapter IMMEDIATE PAST CHAIRMAN Jeff Metz Metz Culinary Management, Dallas Northeastern Chapter

PRLA STAFF PRESIDENT & CEO Patrick Conway | pconway@prla.org EXECUTIVE ASSISTANT Vicki Zeppa | vzeppa@prla.org VICE PRESIDENT OF OPERATIONS John Doulgeris | jdoulgeris@prla.org

INSIDE THIS ISSUE

DIRECTOR OF MEMBER SERVICES—State Amy Kieffer | akieffer@prla.org DIRECTOR OF MEMBER SERVICES—Eastern Region Brenda Mendte | bmendte@prla.org DIRECTOR OF MEMBER SERVICES—Western Region Joyce Kraemer | jkraemer@prla.org MEMBER RELATIONS COORDINATORS Christine Preuss | cpreuss@prla.org Eric Adams | eadams@prla.org MEMBERSHIP SALES REPRESENTATIVES Rich Zlogar, Central PA Karin Kady, Eastern PA Charlie Anderson, Northwestern PA DIRECTOR OF FINANCE & HUMAN RESOURCES Diane Sherwood | dsherwood@prla.org

Security Protocols 15

GOVERNMENT AFFAIRS REPRESENTATIVE Melissa Bova | mbova@prla.org EDUCATION COORDINATOR Hope Sterner | hsterner@prla.org MEETING & EVENT PLANNER Heidi Howard | hhoward@prla.org COMMUNICATIONS COORDINATOR Stephanie Otterson | sotterson@prla.org FINANCE ASSISTANT Paula Judd | pjudd@prla.org PROFESSIONAL SERVICES PROVIDED BY GENERAL COUNSEL Shumaker Williams, P.C. Keith Clark

Restaurant Supplier Contracts

Is the small print SMALL for a reason? 20

GOVERNMENT AFFAIRS Pugliese Associates, Harrisburg Lou Biacchi Greenlee Partners, Philadelphia Andrew Zalenski ACCOUNTANT AND INDEPENDENT AUDITORS Brown, Schultz, Sheridan & Fritz Jim Nace, CPA INVESTMENT ADVISORS Conrad Siegel Tara Mashack-Behney Pennsylvania Restaurant & Lodging Matters is a publication of the PENNSYLVANIA RESTAURANT & LODGING ASSOCIATION 100 State Street, Harrisburg, PA 800-345-5353 | www.prla.org | info@prla.org

Graphtech Publishing Sarah DiCello, Publications Manager 717-238-5751 sarah@thinkgraphtech.com

DEPARTMENTS 4

PRLA 2013 AWARDS PROGRAM

Call for Entries 14

Industry Outlook

Legislative Corner

Legislator Spotlight

Ask US

Chapter News & Notes

Legal Docket

Food Safety

Welcome New Members

For Advertising Information: Alexis Kierce, Account Manager 717-238-5751 alexis@thinkgraphtech.com

Pennsylvania Restaurant & Lodging Matters is published quarterly by the Pennsylvania Restaurant & Lodging Association, 100 State Street, Harrisburg, PA 17101, tel 800-345-5353, and is a benefit of membership in the association. Articles do not necessarily reflect the view or position of the Pennsylvania Restaurant & Lodging Association. Editorial coverage or permission to advertise does not constitute endorsement of the company covered or of an advertiser’s products or services, nor does Pennsylvania Restaurant & Lodging Matters make any claims or guarantees as to the accuracy or validity of the advertiser’s offer.

Creative Design Graphtech

INDUSTRY OUTLOOK

THIS JULY marks the Pennsylvania Restaurant & Lodging Association’s one year anniversary. It’s been an exciting and productive year for the association. Since combining the memberships of the Pennsylvania Restaurant Association and Pennsylvania Tourism & Lodging Association, the hospitality industry’s voice has had greater reach to local and state policymakers. We successfully lobbied against both a broadbased mandatory paid leave policy and an increase Matt English Patrick Conway in the alcohol tax in Philadelphia. We have been at the table throughout the extensive negotiations For the third year in a row, the state budget was in both chambers of the legislature regarding the passed on time. The $28.4 billion budget includes privatization of wine and spirits sales in Pennsylvania. no tax increases and about $120 million more in More than 100 members attended this year’s education funding. Gov. Corbett had a few major Legislative Day, meeting with more than 80 legislators priorities for this budget year — on time budget, and their staffs to advocate for a privatization plan that privatization of wine and spirits sales, transportation benefits licensees, closing the hotel tax loopholes and funding and pension reform. He only achieved the first pre-empting local paid leave policies. Check out the one. Privatization and transportation funding will be Legislative Corner on page 6 for the complete wrap up addressed again in the fall. of the event. Our weekly Legislative Update will keep you informed Internally, we successfully implemented a new on legislative happenings at the local, state and federal database, helping us streamline our administrative levels. Email Melissa Bova, mbova@prla.org, processes such as billing, reporting and managing our to subscribe. member contact information. The next phase is the re-design of our website, which is nearing completion. The new website will offer our members a more userfriendly experience, including the opportunity to pay their dues online and update their contact information in real-time. We are pleased to announce that our Educational Foundation board this spring voted to participate in ProStart®. ProStart® is a nationwide, two-year program for high school students, which develops the best and brightest talent into tomorrow’s restaurant and foodservice industry leaders. We are still ironing out the details of how we will implement ProStart® in Pennsylvania. In the meantime, page 10 provides an overview of the program. 4 •

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SUMMER 2013

Thank you for supporting us as we transitioned to the Pennsylvania Restaurant & Lodging Association this past year. We look forward to serving you and the industry in years to come. Best regards,

Matt English

Patrick Conway

Chairman of the Board

President & CEO

LEGISLATIVE CORNER

ON MAY 7, the Pennsylvania Restaurant & Lodging

Association (PRLA) held its 26th annual Legislative Day in Harrisburg. Nearly 100 members from hotels and restaurants from across the Commonwealth descended on the Harrisburg Capitol to discuss issues of importance to the industry. More than 80 meetings were held with state representative and senators and PRLA once again held its Taste of the State legislative reception, where all 253 members of the legislature were invited. Legislative day is an important event for the association, as it allows elected officials to personally meet with the business owners and representatives of businesses within their district. This year, PRLA members focused on the following key issues:

Privatization of wine & spirits sales PRLA supported HB 790 in the House because the bill increases the wholesale discount from 10 to 14 percent, allows licensees to sell six bottles of wine to go and preserves important de novo protections. Although PRLA supported passage in the House, the association has some concerns that it will address in the Senate. PRLA’s primary goals are to: increase the wholesale discount to 18 percent, ensure a privatized wholesale system does lower prices, and reduce the increased fees and fines for licensees in the current legislation.

Increase of the alcohol tax in Philadelphia and enabling it in other municipalities PRLA is opposed to all alcohol tax increases and creating new alcohol taxes in other areas. It is a tax that specifically targets the hospitality industry, and puts businesses in an alcohol tax location at a disadvantage to those businesses that do not have to assess such a tax. Mandatory leave policy pre-emption

legislation that would pre-empt local paid leave mandates. Closing the hotel tax loophole PRLA supports the closing of the hotel tax loophole. Currently, the Commonwealth is losing money because online travel companies are remitting taxes on a lesser amount than the actual cost at which they sell a hotel room. It puts in-state hotels that collect and remit the tax properly at a competitive disadvantage.

PRLA believes that businesses should make operating decisions based on their specific needs, not because a local government decides for them. Private sector employee benefit decisions should not be determined by local governments. PRLA and other business groups support state

Stay tuned to our weekly Legislative Update e-newsletter for the most up-to-date information on the Legislature’s actions. Not receiving the Legislative Update? Email Melissa Bova at mbova@prla.org to subscribe.

If you didn’t participate in Legislative Day in 2013, please consider joining us next year. This is an important event for our industry and can only be successful when you participate.

The Pennsylvania Restaurant & Lodging Association is committed to representing the hospitality industry at all levels of government on legislative and regulatory issues that have a direct impact on our industry and our members’ bottom lines. The above issues are just a few of the priorities in which your association is currently engaged.

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SUMMER 2013

legislator spotlight

Senator Larry Farnese SENATOR LARRY FARNESE was elected to the Senate in

2008 to represent Pennsylvania’s First Senatorial District. Sen. Farnese serves as the Democratic Chair of the Communications and Technology Committee. He is also a member of the Appropriations Committee, Banking and Insurance Committee, and the Judiciary Committee. He earned a Bachelor’s degree in Political Science from Villanova University and graduated from Temple University’s Beasley School of Law in 1994. He is presently of counsel at Archer and Greiner P.C. He is a member of the Pennsylvania Housing Advisory Committee and serves on the board of the Pennsylvania Historical Society. He also serves on the board of Casa Farnese, the first affordable senior housing complex in Philadelphia, founded in 1966 by the Senator’s grandfather. Following in his family tradition of commitment to education, Sen. Farnese was recently appointed to serve on the boards of the Pennsylvania Higher Education Assistance Agency (PHEAA) and the Public School Employees Retirement System (PSERS). He continues to build his record as a reformer through legislation and policy initiatives in the areas of public safety, economic development, and job creation. Recognizing that quality of life is crucial to economic development, Sen. Farnese has sponsored a number of initiatives to improve public safety. He has introduced legislation to reduce gun violence, and supported continued funding of the Gun Violence Task Force to combat straw purchases of illegal handguns. Sen. Farnese obtained state funding to help restore the Philadelphia Police Mounted Unit, and has also worked closely with local officials and community leaders to improve oversight of neighborhood nuisance bars. He recently became the leading proponent in Pennsylvania for “Caylee’s Law.” Sen. Farnese has championed capital funding for many commercial and cultural institutions, including new hotel construction, expansion of the convention center, and development of the Delaware River waterfront. He has been an advocate for dredging the Delaware River and the expansion of Philadelphia’s ports, activities which support and create thousands of family-sustaining jobs. Sen. Farnese introduced enabling legislation for Philadelphia’s property tax abatement program to spur new construction, and successfully led the fight to defeat proposed taxes on the arts and professional services. Sen. Farnese has sponsored bi-partisan legislation to enact campaign finance contribution limits, and initiatives to end pay-toplay contributions by companies doing business with the state. In 2009, he drafted the provisions in state law that ended the DROP program for future elected officials statewide, and also authored new reforms to Pennsylvania’s gaming law.

Pennsylvania team competes at 10th annual Lodging Management Program International Competition The American Hotel & Lodging Educational Institute hosted the 10th Annual LMP International Competition on April 10–12, 2013, in Orlando, Fla. Each year, hospitality students from around the world come to Rosen Shingle Creek Resort in Orlando, Fla. to showcase their skills in a two-day competition that challenges participants with events based on real-world job scenarios. Thirteen teams participated in this year’s competition, representing schools in the Bahamas (Andros Island and New Providence), California, Florida, Guam, Hawaii, Idaho, New Hampshire, Ohio, Oklahoma, Pennsylvania, Washington, D.C., and Wyoming. These teams competed for scholarship dollars and a chance to join AH&LA in New York City this November.

planning, case studies and knowledge bowl quiz. The judges were all experts and professionals from the industry. Between events, the students had the opportunity to network with their peers from around the world, as well as representatives from colleges, hotels, hospitality associations and industry experts. “Participants benefit from these programs and competitions by learning and practicing industry-specific skills, gaining real-life work experience, networking with hospitality professionals who can provide career advice and opportunities, and competing for valuable scholarships,” said Shah.

Participants benefit from these programs and competitions by learning and practicing industry-specific skills, gaining real-life work experience, networking with hospitality professionals who can provide career advice and opportunities, and competing for valuable scholarships.

Under the leadership of teacher Patty LeCompte, the Monroe Career & Technical Institute team of Isaiah Griffin, team captain and junior at Pocono Mountain East; Namansa Marah, senior at East Stroudsburg North; Tracy Trotman, sophomore at Pocono Mountain West; and Keziah Duncan, sophomore at East Stroudsburg South, represented Pennsylvania. Griffin and Marah were members of the MCTI team that took home the overall first place international title in 2012. Last November, that team had the opportunity to attend the AH&LA Fall Conference and meet the AH&LEF Board of Trustees. It was a meeting that helped them return to the competition in 2013. Neil Shah, president and chief operating officer of Hersha Hospitality Trust, was at the meeting and impressed by the students.

While the 2013 team did not place in the top three, LeCompte did not see this competition any less successful. “We want the folks at Hersha to know that this event has made a huge difference in each of their lives.”

Marah graduated this spring and is planning on pursuing hospitality management at Pace University in the fall. After her experience at the competition, she plans on concentrating in lodging management and would like to become a general manager someday. Griffin, Trotman and Duncan will all return to the MCTI program in the fall. They are still exploring all that the industry has to offer, and with the expansion of their program’s curriculum at MCTI, they will have many new opportunities to learn.

“The 2012 team gave an impressive presentation to the board, after which they mentioned that they did not have the funds to attend the national competition again in 2013,” he said. “Inspired by their passion for hospitality and competition, I felt compelled to sponsor the team so that they could again compete in 2013,” he continued. “This was an opportunity that they earned and truly deserved.” Hersha Hospitality Management is one of the top 10 hotel management companies in the United States, with 22 hotels under management in Pennsylvania alone. At this year’s competition, the MCTI team displayed their hospitality knowledge and skills by competing in a variety of events, including a night audit, room inspection, banquet

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Left to right: Joe McInerney, President & CEO, AHLA, Tracy Trotman, Isaiah Griffin (Team Captain), Namansa Marah, Keziah Duncan

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SUMMER 2013

ask

Knowledge is power in your operation. As a PRLA member, you have many informational resources available at your fingertips to help you with your day-to-day legal, regulatory and operational questions.

Tip Reporting

What is a tip vs. a service charge?

A: A tip is a sum a customer gives as a gratuity in recognition of a service performed. Whether to give a tip and how much to give is solely the decision of the customer. A service charge is an amount automatically added to a customer’s bill by management. Under federal law service charges must be considered as income to the employer and may be retained by the employer or distributed to employees in any amount chosen. Service charges that are distributed to employees are treated as wages under federal law.

What type of tip reporting is required by employees?

A: Employees need to keep daily records and must report tip earnings to their employer if they receive at least $20 in a month. Daily tip records are kept so employees can: • report tips accurately to the employer • report tips accurately on their tax return • prove tip income if ever questioned

IRS Form 4070A is a simple daily diary to record tips. Non-cash tips such as tickets, passes or other items of value should also be recorded in this tip diary. Employers may also consider purchasing the Tip Reporting Education Kit from the National

Restaurant Association online store (www.restaurant.org). Members receive a $30 discount off the $59.95 non-member price. The kit includes an employer guide, employee brochures, posters, and sample payroll stuffers. Although the law does not require employers to police employee tip reports, unreported tips can cause big problems for the employer and the employee. Employers who fail to report tip income can be held liable for income tax and their share of FICA tax on unreported tips, and could be assessed penalties and interest. Employers may also have the IRS step in to estimate unreported tips and be liable to pay back taxes. Because of these liabilities, Employers should be vigilant in reminding their employees the importance of accurate reporting and supply helpful tools in keeping accurate records.

I own a restaurant; do I need to file any specific forms to the IRS regarding tips?

A: IRS form 8027 is required to be filed in a timely manner by restaurants:

Is there a scenario when I must allocate tips?

A: If total tips reported by employees are less than 8 percent of the establishment’s food-and-beverage sales (not counting carry-out sales or sales to which a service charge of 10 percent or more is added), the employer is required to allocate the difference among all directly tipped employees who reported less than 8 percent of their share of the restaurant’s sales.

This information has been summarized from the National Restaurant Association Legal Problem Solver. The Legal Problem Solver is a free, online member resource that summarizes various legal topics, including tip reporting, employee meals, uniforms, etc. Visit restaurant.org/ profitability/support/legal to access all available topics.

• where tipping is customary • that provides food and beverages for on-premises consumption • that normally employs more than 10 employees (tipped and non-tipped) or the equivalent (80 employee hours) on a typical day SUMMER 2013

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ProStart

ProStart trains students on industry-specific skills that can be used in all aspects of the restaurant and foodservice industry. ProStart® is a nationwide, two-year program for high school students that develops the best and brightest talent into tomorrow’s restaurant and foodservice industry leaders. From culinary techniques to management skills, ProStart’s industry-driven curriculum provides realworld educational opportunities and builds practical skills and a foundation that will last a lifetime. By bringing industry and the classroom together, ProStart gives students a platform to discover new interests and talents and opens doors for fulfilling careers. It all happens through a curriculum that teaches all facets of the restaurant and foodservice industry, inspires students to succeed and sets a high standard of excellence for students and the industry. With national and local support from industry members, educators, the National Restaurant Association Educational Foundation (NRAEF) and state restaurant associations, ProStart reaches 90,000 students nationwide in 1,700 schools in 47 states, Guam and Department of Defense bases.

SUMMER 2013

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WHO ARE PROSTART STUDENTS AND EDUCATORS? • ProStart serves all types of communities, from rural to innercity schools across the country, to Department of Defense schools around the world. • Students take it as an elective track in traditional high schools, career & technical centers, and vocational high schools. • Educators range from family & consumer sciences educators to chefs who transitioned from industry into the classroom.

PROSTART NATIONAL CERTIFICATE OF ACHIEVEMENT The ProStart National Certificate of Achievement is the exciting culmination of the ProStart program. To earn it, students must complete the program, pass two national exams and complete 400 hours of mentored work experience. It is integrally linked to NRAEF scholarship opportunities and articulation benefits at more than 60 of the country’s leading hospitality/ culinary arts colleges and universities.

The Pennsylvania Restaurant & Lodging Association and its Educational Foundation are pleased to begin participating in the ProStart program. The PRAEF board of directors is currently developing Pennsylvania’s implementation strategy. If you are interested in becoming a program mentor, please contact Hope Sterner, education coordinator, at (800) 345-5353 or hsterner@prla.org.

NATIONAL PROSTART INVITATIONAL® The National ProStart Invitational, held each spring, showcases the talent of the top ProStart students as they compete in culinary & management events. Culinary teams have 60 minutes to prepare a three-course meal using only two butane burners, while also competing in knife skills and poultry fabrication. Management teams develop an original restaurant concept and apply critical thinking skills to challenges managers face in day-to-day operations. Annually, more than $1 million in scholarships are awarded to the top five teams in both events from the NRAEF and attending colleges.

Source: National Restaurant Association Educational Foundation

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SUMMER 2013

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Awards Program Call for Entries

call for entries

16 UAL Power PEC N AN Golf Classic West TH

The Pennsylvania Restaurant & Lodging Association is now accepting nominations for its 2013 Awards Program in the following categories: EXCELLENCE IN FOOD SAFETY AWARD Deadline: August 15, 2013

Tuesday, August 27 Omni Bedford Springs Resort

RESTAURANT, LODGING & ALLIED MEMBERS OF THE YEAR Deadline: October 15, 2013 WILMER S. LAPP KEYSTONE AWARD Deadline: October 15, 2013

Criteria, eligibility requirements, nomination forms and more information about the program can be found at:

www.prla.org/awards

ServSafe速 Food Protection Manager Certification Classes

TODAY REGISTER rg www.prla.o 353 (800) 345-5

presented by the Pennsylvania Restaurant & Lodging Association

AUGUST

SEPTEMBER

OCTOBER

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9/9 9/9 9/16 9/16 9/23 9/23 9/30 9/30

10/7 Harrisburg 10/21 Monroeville 10/21 Philadelphia 10/21 State College 10/28 Bethlehem

Butler Philadelphia State College Reading Gettysburg Greensburg Tannersville

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NOVEMBER 11/4 Butler 11/4 Lancaster

Retest, home study and online classes also are available.

Early Bird Pricing*

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Shipping & handling fees apply. Visit www.prla.org or call (800) 345-5353 for details.

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DECEMBER 12/2 12/2 12/9 12/9

Harrisburg Philadelphia Reading Williamsport

By Alan M. Freeman As seen in Lodging Magazine March 2012.

Security Protocols Hotels are microcosms of the retail experience. They include overnight accommodations, of course, but many also include restaurants, recreation facilities, and shopping. Thus, there is a daily struggle to meet customer safety and loss-prevention objectives without imposing security that is so intrusive that it harms the guest experience. MUCH OF THE LITIGATION RISK posed by internal security is rooted in the need for subjective analysis and discretionary intervention (e.g. who to watch, and when and how to intervene). Shift managers, front desk clerks, bellmen, pool attendants, and security guards confront these questions every day: • When should they respond to noise complaints by shutting down a party in a guestroom? • At what point should they intervene in a poolside party that has gotten too wild? • When should they approach a person who appears to be loitering without a legitimate reason to be on the property?

COMPREHENSIVE POLICIES The core of your security program should be a set of policies that guide employee conduct. They also are the first place a plaintiff’s attorney will look for evidence that you have targeted a specific group for disparate treatment, or that you acquiesce in bad behavior by employees. Thus, your security policies should articulate the purpose of the program, explain how it will be implemented, and set minimum and maximum parameters for employee conduct. Policies that are developed by outside experts based on best practices and industry standards are more likely to withstand scrutiny than are programs developed by company insiders who lack requisite expertise. Regardless of who develops the policies, they must periodically be reviewed to ensure that they remain consistent with prevailing law, evolving best practices and changed market conditions. It is equally important that your policies are adhered to in practice and consistently enforced. This can be a significant challenge for hoteliers that operate nationally or internationally, but periodic surprise audits can be effective tools to ensure compliance, identify gaps in training, weed out problem employees and defend against charges of acquiescence.

• When and how should they intervene in cases of suspected shoplifting? Even honest mistakes in answering these questions can lead to a perception of discrimination or other inappropriate conduct, and the resulting lawsuit can sap profitability and lead to devastating publicity in a sensitive marketplace. Keeping in mind that applicable laws vary state-by-state and there is no “one-size-fitsall” solution, here are some suggestions to mitigate your litigation risk:

EFFECTIVE TRAINING The best programs are developed and implemented by professional trainers, and they involve scenario-based training, role-playing exercises and specific instruction on profiling and the bounds of appropriate physical contact. Initial and refresher training should be provided to all who interact with guests, and there should be defined standards for graduation. Like your policies, your training program must periodically be reviewed and updated. Continued on next page SUMMER 2013

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PENNSYLVANIA RESTAURANT & LODGING matters

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serving the needs of the restaurant industry for more than 45 years

STAFFING The constitution of your staff can be a source of litigation risk. A staff that is homogenous although the community is diverse may suggest inappropriate hiring and promotion practices, and a plaintiff’s attorney will use any disparity to argue that your security practices are tainted by discrimination. Take care to ensure that hiring and promotion practices are nondiscriminatory and result in a diverse workplace.

SURVEILLANCE, APPREHENSION AND DETENTION • Acquisition, sale and financing of restaurants • Liquor license acquisition

and sale • Defense of liquor license citations and enforcement actions • Dram shop liability • Structuring to limit liability • Employment law and wage & hour issues • Litigations, mediation and dispute resolution • Intellectual property protection including trademarks, copyrights and trade secrets • Tax, business and estate planning SERVING THE FOLLOWING AREAS:

PENNSYLVANIA MARYLAND NEW JERSEY NEW YORK WASHINGTON DC 1-888-794-5542

There is a subjective element to security that cannot be avoided, though it invites litigation risk. Consider carefully the criteria that will be used to determine whether to monitor a particular person or location, whether to focus surveillance on particular days or times or at particular events, and whether to shut-down events on your property. Where possible, deploy security resources based on objective data rather than hunches, and initiate surveillance (and, where absolutely necessary, detention) based on non-discriminatory criteria and uninterrupted observation. Apprehensions should be effected away from large crowds if possible, and the use of force should be minimized.

www.shumakerwilliams.com

CUSTOMER SERVICE How a person is treated when he interacts with your employees will influence what he does next. Thus, interventions should be discrete, respectful, and efficient, while still being safe and secure. Particular care should be given to the treatment of juveniles. Where bag and body searches are absolutely necessary, they should be “same sex” and witnessed. And when customers complain about mistreatment, take their complaints seriously.

RECORD KEEPING Adequate record keeping is a powerful tool to reduce litigation risk. Generally, your staff should be required to make a contemporaneous written record of any intervention, including a narrative description of the process by which they came to observe, interact with and, where applicable, detain, the guest. These reports should be stored in a central location, and be reviewed by supervisors for sufficiency and identification of possible employee misconduct. There is no silver bullet to ward off frivolous litigation, but careful attention to the preparation and implementation of your security program can be an effective way to reduce your litigation risk. Alan M. Freeman is a partner in the Washington, D.C. office of Blank Rome LLP. His commercial litigation and legal risk reduction practice is national in scope, and he can be reached at Freeman@BlankRome.com.

CHAPTER NEWS & NOTES

what’s happening around the state? BERKS-SCHUYLKILL CHAPTER • Winedown Café & Wine Bar of Reading is on YouTube. Catch owner Ben Franco’s weekly wine tasting notes and updates at www.youtube.com/user/winedowncafe. BRANDYWINE CHAPTER • National Restaurant Association Chairman Phil Hickey was the keynote speaker at the PRLA Power PAC Golf Classic on June 25 at RiverCrest Golf Club & Preserve in Phoenixville. Hickey Phil Hickey currently serves as CEO of Jocks II Inc., which is based in Santa Rosa Beach, Fla. • Brandywine Chapter will hold a golf tournament on Tuesday, September 17 at Applecross Country Club, Downingtown. Proceeds will benefit the association’s Educational Foundation scholarship fund.

present several scholarship to culinary and hospitality students through the association’s Educational Foundation. • Lancaster County Coffee Roasters has partnered with the Lancaster Barnstormers to be the exclusive coffee provider at Clipper Magazine Stadium. LCCR will be serving its great coffees and cold coffee-based drinks at all Barnstormers’ home games. • Singer Equipment Company of Elverson has been named the #2 business in the Greater Reading Top 50, as compiled by the Greater Reading Chamber of Commerce and Industry. Singer Equipment Company is currently the fifth largest foodservice equipment and supplies distributor in the United States. Its nine contract offices provide kitchen design and installation services nationwide. Stores in Wyomissing and Philadelphia are open to the public. The company is celebrating its 95th anniversary in 2013. For more information, visit www.singerequipment.com. • This year Sabrina Heller, Andrew Hershey and Hannah Valent, all students at the PA School of Culinary Arts at YTI Career Institute, were each awarded $1,200 scholarships from the Lancaster Chapter’s contributions to the Educational Foundation scholarship fund.

• Isaac’s Famous Grilled Sandwiches recently received the 2013 Circle of Honor distinction from United Way of Lancaster County for its stellar annual Employee Campaign. In addition to financial contributions, the Circle of Honor recognizes Isaac’s quality workplace campaign, employee support of and participation in United Way activities, and other nonmonetary contributions. KEYSTONE CHAPTER • James Purdum, general manager for Hospitality Services at Penn State, has been named the recipient of the 2013 International Foodservice Manufacturer’s Association (IFMA) Silver Plate Award in Hotels and Lodging. Purdum and other Silver Plate Award winners were honored at the 59th annual Gold & Silver Plate Awards Celebration on May 20 at the Great Hall at Union Station in Chicago. MIDWESTERN CHAPTER • The PRLA Power PEC Golf Classic West will be held at the beautiful Omni Bedford Springs Resort, Bedford, on Tuesday, August 27. The resort is home to one of this country’s first golf courses. Overlooking breathtaking views of the Allegheny Mountains and

CENTRAL CHAPTER • Make plans to play the annual Central Chapter Golf Outing, which will take place on Monday, October 21 at Hershey Country Club. More than 300 golfers are expected to enjoy a full day of food, golf, contests and prizes. Proceeds benefit the association’s Educational Foundation scholarship fund and the Pennsylvania State Trooper’s Camp Cadet program. • Central Chapter awarded scholarships to three students this year from their contributions to the PRLA Educational Foundation scholarship fund. Louis Manza is headed to Johnson & Wales University, Megan Waleff to Robert Morris University and Samantha Formica will continue her education at a yetto-be-determined institution. LANCASTER CHAPTER • Get your clubs ready for the annual Lancaster Chapter Golf Outing, which will be held on Monday, September 23 at Foxchase Golf Club, Stevens. This yearly event raises money for the chapter to

Norm Cella, Ronald Highlands, Tony Crouse, and Jake Lawrence enjoy their day on the course during Central Chapter’s 2012 golf tournament.

For more information on any of the above events or to include your event or news in the next issue of Pennsylvania Restaurant & Lodging Matters, contact Heidi Howard, PRLA meeting and event planner, at (800) 345-5353 or email to hhoward@prla.org. SUMMER 2013

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CHAPTER NEWS & NOTES continued Cumberland Valley, this remarkable course spans the work of three golf architectural masters—Spencer Oldham, A.W. Tillinghast, and Donald Ross. Bedford Springs Old Course has undergone a total renovation overseen by noted classic golf course restoration architect Ron Forse, restoring it to its original course layout. A round of golf on these historically significant tees is a must-play for golf enthusiasts of all levels. Register online at www.prla.org/pecgolf. • In February, Hoss’s Steak & Sea House, based in Duncansville, was recognized by the Beef Checkoff Program as the 2012 National Foodservice Beef Backer Award winner in the Chain Operator category. Started in 2007, the National Foodservice Beef Backer Awards program recognizes foodservice operators that exhibit leadership and innovation in promoting and using beef. A judging panel of industry professionals selected one winner in each of the three categories: Independent Operator, Chain Operator and Innovator of the Year. The Beef Checkoff Program was established as part of the 1985 Farm Bill.

• Through the Darden Foundation’s Restaurant Community Grants program, the staffs of 21 area Red Lobster, LongHorn Steakhouse, Capital Grille, Olive Garden and Bahama Breeze restaurants recently awarded $21,000 to Philabundance, the Philadelphia area’s largest hunger-relief organization. WESTERN CHAPTER

Bertrand Artigues (r), with Anthony Bourdain at the National Restaurant Association show. American chef, author and Travel Channel personality Anthony Bourdain at the National Restaurant Association show in Chicago this May.

NORTHEASTERN CHAPTER • John Metz, vice president of restaurant operations at Metz Culinary Management, is carrying on his father’s legacy by being the second in his family to receive the International Food Manufacturers Association (IFMA) Silver Plate award. His father, John C. Metz Sr., received the award in 1979 in the Foodservice Management category. NORTHWESTERN CHAPTER • Bertrand Artigues, owner of Bertrand’s French Bistro in Erie and Northwestern Chapter President, spent some time with

PHILADELPHIA CHAPTER • Long recognized for its excellence in food and beverage, Omni Hotels & Resorts has created its own Umami Sauce that has premiered at the Omni Hotel at Independence Park, Philadelphia. Created by a team of Omni chefs from Chicago, Denver, Orlando and San Antonio, Omni Hotels’ new Umami Sauce captures the deliciousness that defines umami, a loose translation from the Japanese umai (delicious) and mi (taste).

• Joseph DiSalvo of DiSalvo’s Station Restaurant, Latrobe is the current chairman of Distinguished Restaurants –NA). DiRo –NA is a of North America (DiRo non-profit organization that, by recognizing excellence, seeks to promote fine dining throughout the United States, Canada, –NA will hold its annual and Mexico. DiRo Conference & Reunion September 15–18, 2013, at the Sheraton Wall Centre, Vancouver. –NA or the For more information about DiRo conference, visit www.dirona.com.

John Metz (c) receives his IFMA Silver Plate Award.

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PENNSYLVANIA RESTAURANT & LODGING matters

• PRLA and Western Chapter board member Steve Musciano of ARAMARK has been selected as a 2013 ARAMARK Outstanding Volunteer and a Bronze Jefferson Award for Public Service winner. The ARAMARK Outstanding Volunteer Awards showcase ARAMARK employees’ extraordinary efforts to enrich and nourish lives in their communities through exemplary volunteer service. We recognize Steve Musciano and honor the wonderful things they do through the ARAMARK Outstanding Volunteer Awards. Since 2007, we have recognized dozens of employees for their commendable service. Each year, ARAMARK partners with the Jefferson Awards for Public Service (www.jeffersonawards. org) to identify those employees who demonstrate outstanding volunteer service and involvement in their communities.

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SUMMER 2013

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LEGAL DOCKET

Restaurant Supplier Contracts Is the small print SMALL for a reason?

by Evan C. Pappas, Esquire Shumaker Williams, P.C. General Counsel, Pennsylvania Restaurant & Lodging Association

As a restaurant,

forgotten that a contract governed their relationship, the situation changed as soon as the new company took over. The contract terms became important—but they were less than favorable.

you sign contracts all the time for the delivery of your food and drink, services related to uniforms and cleaning, and construction and renovation. Although you could think of better ways to spend your time than revising a contract provided by a vendor, this time is well spent because contracts contain a lot of small print, and are drafted to make the deal better for the supplier—not the restaurant. Provided that your supplier’s performance is satisfactory, non-preferable contract provisions may never affect or concern you. However, sometimes suppliers become less than responsive, or a better deal comes along that you might like to consider. For example, we recently assisted a restaurant client who had been with the same carbon dioxide gas supplier for many years. The supplier they had been dealing with for years had been purchased by another company and, therefore, all the supplier contracts became the property of the new (out-of-state) company. As soon as the new supplier took over control, immediate service problems developed. So although the restaurant was content for years with its supplier’s service, and may have even

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Read the fine print! Are contracts drafted to make the deal better for the supplier — not the restaurant?

PENNSYLVANIA RESTAURANT & LODGING matters

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SUMMER 2013

Two important contract provisions that compliment one another are the provisions related to contract renewal and contract termination. Restaurants should be careful to understand them because they can vary widely from supplier to supplier. An automatic renewal provision usually states that on each anniversary of the contract it will automatically renew and extend for another one year period (or longer). The termination clause outlines the circumstances under which you and the supplier may cancel the contract. Typically, a supplier will draft the contract in such a way that prevents the restaurant from canceling the contract at any time except for a set number of days prior to the renewal date. As the recipient of services, you want to make sure, if possible, that this contract clause allows you to terminate the contract at any time if you become unhappy with their services. Even if you do not negotiate more preferable termination language for the contract, you

must understand your responsibilities pursuant to the termination clause. Merely providing notice when you choose to do so is not sufficient. Cancellation provisions are sometimes written to require you to give notice within a certain time frame before the expiration of the term. This means that your notice cannot be provided too early and not too late. Other cancellation provisions require you to give notice no later than a certain number of days before the expiration of the term. This means that you must consider cancellation at a sufficiently early date before the renewal. As an example, a recent supplier contract we reviewed on behalf of a client contained a cancellation provision that required notice of cancellation to be provided at least 12 months prior to the expiration of the contract term. Such a provision requires the restaurant to know a full year ahead of the end of their contract term whether or not they want to cancel the contract. Failing to provide notice a full year in advance could cause you to be bound not only for the duration of that term, but for an additional year on top of that! If not negotiated, such a provision can trick a restaurant owner into being bound by the terms of their supplier contract for much longer than anticipated.

Having a specific description of services may seem like an obvious ingredient to a good contract, but too often contracts contain very poor descriptions of the services to be performed—which could lead to differences of opinion later.

Another set of contract provisions to be aware of relate to court venue and alternate dispute resolution. Court venue provisions or “choice of law” provisions dictate what state’s laws will be followed if a dispute arises and what court may hear a case if a dispute arises. An outof-state supplier will obviously select its home state as the venue for legal actions. This can result in an injustice for a restaurant owner because it may require hiring an out-of-state lawyer and legal proceedings in another state. Alternate dispute resolution (ADR) is another thing you must consider. ADR encompasses both mediation and arbitration, which are two methods to resolve disputes without having to litigate in state or federal court. Mediation is where an independent, neutral person is selected to hear the issues and attempts to get the parties to negotiate or agree to a settlement. Arbitration is an informal trial where lawyers or arbitrators, rather than judges, hear the case and make a binding ruling.

If these provisions exist, they are not automatically bad because ADR is typically much cheaper than a trial. However, you want to ensure that the arbitration or mediation provisions are fair and allow you a right of appeal if you are not satisfied with the result. Often a supplier will require arbitration to the exclusion of any other courts that may otherwise hear the issue. This makes the arbitration the only place where you may have your case heard. In some cases, mediation may be required before arbitration drives a wedge between you and an ultimate resolution of the dispute.

Some last considerations when you negotiate contracts with vendors or suppliers relate to specific description of the services, limits on assignability, and remedies for non-performance of the contract. Having a specific description of services may seem like an obvious ingredient to a good contract, but too often contracts contain very poor descriptions of the services to be performed— which could lead to differences of opinion later. Regarding assignment of the contract, some supplier contracts may attempt to limit your ability to assign the contract to another restaurant or successor. In the event your restaurant may be purchased or merged with another restaurant, not having such limitations on assignment of the contract will allow you to reap the benefits of that contract without having to execute a new one. Finally, most contracts that are drafted by the supplier (or their attorney) will be silent on what penalties should be incurred if the supplier provides insufficient services or breaches the contract. You must specifically negotiate these terms into the contract so that the supplier has an incentive to continue providing quality goods and services. Being aware of these provisions will help you as you review supplier contracts. Even if you think the supplier may not be willing to accept your changes, you (or your counsel) must try to negotiate for these changes before your signature is provided— because after you sign, it’s too late to make changes.

SUMMER 2013

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PENNSYLVANIA RESTAURANT & LODGING matters

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FOOD SAFETY

ServSafe Food Handler program Your manager or chef have been trained and certified in food safety through a program like ServSafe® Food Safety for Managers. Are they passing that knowledge on to the rest of your staff who handle food? Do you have an in-house training program for new employees on food safety best practices? It is mission-critical to ensure that every member of your foodservice staff understands what they must do to handle and prepare food safely. One food safety incident can destroy a business, so food safety training is vital. Rather than risk your business or your loyal customers’ health, ensure your team learns and adheres to proper food safety practices by providing them with training. The ServSafe® Food Handler program is an easy to use, nationally recognized program that is scientifically based and legally defensible. Available online or on-site, it uses innovative techniques to help employees learn critical concepts and practices. For your protection and peace of mind, use the most trusted training system in the industry.

Participants are thoroughly trained in the following five key areas: • basic food safety • personal hygiene • cross-contamination/allergens • time and temperature • cleaning and sanitizing

It is mission-critical to ensure that every member of your foodservice staff understands what they must do to handle and prepare food safely. ServSafe® works closely with the FDA and other regulatory agencies to ensure comprehensive training is compliant with all national, state and local requirements. The program uses consistent terminology and definitions, which makes implementation, supervision and management of all food safety practices easy and efficient. The materials are designed to keep students engaged and motivated while retaining and recalling. It is delivered online or on-site and in English and Spanish.

IT PAYS TO BELONG Pennsylvania Restaurant & Lodging Association members have exclusive access to special discount programs. If you aren’t already a member, join Pennsylvania Restaurant & Lodging Association today by calling 800-345-5353 to take advantage of these great offers: Heartland Payment Systems Credit Card and Payroll Processing UnitedHealthcare Health Insurance Programs Prime Source Purchasing Manufacturer Rebate Program Fishbowl Email Marketing Solutions BMI Music Licensing National Restaurant Association Operator Resources American Hotel & Lodging Association Operator Resources RestaurantOwner.com Operator Resources Pennsylvania Restaurant & Lodging Association 100 State Street, Harrisburg, PA 17101 800-345-5353 • www.prla.org

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SUMMER 2013

Participants must satisfactorily complete a 40-question assessment in order to be awarded a Certificate of Achievement. To see if the Food Handler program meets your training needs, call PRLA at (800) 345-5353 or visit www.servsafe.com/foodhandler.

WELCOME NEW MEMBERS Restaurant Members 10.09 Kitchen Bedford, PA 17Th Street Cafe Pittsburgh, PA Arooga’s Grille House & Sports Bar Harrisburg, PA Arooga’s Grille House & Sports Bar York, PA Bado’s Pizza Grille & Ale House Pittsburgh, PA Barnaby’s Of West Chester West Chester, PA B. Braun Bethlehem, PA Bella Cena Hermitage, PA Carson City Saloon Pittsburgh, PA Casa Italia Pizza & Pasta Lincoln University, PA Casey’s Drafthouse Pittsburgh, PA Chart House Philadelphia Philadelphia, PA Chris Bozakis Easton, PA Country Barn LLC Lancaster, PA Dragon Fire Pittsburgh, PA Eagle Restaurant & Bar Harrisburg, PA Easy Street Pittsburgh Pittsburgh, PA Flying Hills Cafe & Grocery Reading, PA Freddie’s II Restaurant & Lounge Bethel Park, PA Front Street Fountain Media, PA Mrs. Gibble’s Candies & Restaurant Greencastle, PA Grand Concourse Pittsburgh, PA Hershey Road Family Restaurant Harrisburg, PA Hollywood Casino Grantville, PA Infinito’s Pizza Buffet Hanover, PA Infinito’s Pizza Buffet Harrisburg, PA

Kelly’s Cafe Coatesville, PA

TreVi Pizza Pasta BYOB Glenside, PA

Landry’s Restaurants Houston, TX

Urban Tap Pittsburgh, PA

Lang Restaurant Group dba Steel City Samiches Indiana, PA

Valozzi’s Greensburg, PA

La Verona Kennett Square, PA Le Castagne Philadelphia, PA The Lodge At Tussey Mountain Boalsburg, PA London Grill Philadelphia, PA Nine on Nine Pittsburgh, PA The Manor Harrisburg, PA McCormick & Schmick’s Philadelphia, PA McCormick & Schmick’s — Piatt Place Pittsburgh, PA McCormick & Schmick’s — SouthSide Pittsburgh, PA Meat & Potatoes Pittsburgh, PA Morton’s Of Chicago King of Prussia, PA Morton’s Of Chicago Philadelphia, PA Morton’s Of Chicago Pittsburgh, PA OffCenter Grill York, PA Olive or Twist Pittsburgh, PA Pappy T’s Pub & Lounge Hamburg, PA Publick House Restaurant and Tavern Wyomissing, PA Quaker Steak & Lube Johnstown, PA Reading Terminal Market Merchants Association Philadelphia, PA Reading Terminal Market Merchants Catering Co. Philadelphia, PA Red Robin — Collegeville Collegeville, PA

Infinito’s Pizza Buffet Lancaster, PA

Romeo’s Pizzeria & Mediterranean Kitchen Indiana, PA

Infinito’s Pizza Buffet Lebanon, PA

Sheetz, Inc. Altoona, PA

Infinito’s Pizza Buffet York, PA

Side Bar Restaurant West Chester, PA

Isaac’s Famous Grilled Sandwiches Mount Joy, PA

Slack’s Hoagies Willow Grove, PA

Jacks Steak and Shakes West Chester, PA

The Soda Jerk Diner Hummelstown, PA

Jane G’s Restaurant Philadelphia, PA

Square Bar West Chester, PA

Valozzi’s Pittsburgh Pittsburgh, PA Windsor Dining Room Skytop, PA Winthorpe & Valentine Philadelphia,PA Xochitl Philadelphia, PA

Allied Members A+ Insurance Agency 1000 Nationwide Drive Harrisburg, PA 17110 Andy Jiang A-Tech Refrigeration and Mechanical 474 Hickman Street Extension Bridgeville, PA 15017 Jim Dunlay Brakebush Brothers, Inc. N4993 6th Drive Westfield, WI 53964 Steve Male Butera Beusang Cohen & Brennan 630 Freedom Business Center, Suite 212 King Of Prussia, PA 19406 J. Kenneth Butera Chorus Communications, Inc. 210 Church Street, Unit D Philadelphia, PA 19106 Mike Barkovich Clean Currents 1528 Walnut Street Philadelphia, PA 19102 Dylan Straughan Comfort Profit Consulting Inc. 745 Hill Road Hegins, PA 17938 Dan Comfort Conference Center At Central Penn College PO Box 309 Summerdale, PA 17093 Kevin Karczewski EA Consulting Group 303 Vine Street #101 Philadelphia, PA 19106 Eric Arnold First Niagara Risk Management 125 Hillvue Lane Pittsburgh, PA 15237 Jason Corrado Fisher & Phillips LLP 201 King of Prussia Road Wayne, PA 19087 Brent Cossrow Giannascoli & Kent 722 Springdale Drive Exton, PA 19341 Thomas Kent Jr.

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High Impact 2, Inc. 171 Fifty Acre Road Johnstown, PA 15904 Grace Markum HOODZ of Scranton/Wilkes Barre 1812 Tingley Lake Road New Milford, PA 18834 Kevin Gerland Mark Bakos and Associates PO Box 20003 Scranton, PA 18502 Mark Bakos New Age Financial Consulting LLC 985 W. Bristol Road Warminster, PA 18974 Julia Nikishina Penn Jersey Paper 9355 Blue Grass Boulevard Philadelphia, PA 19114 Steve Lettero Philadelphia Gas Works 800 W. Montgomery Avenue Philadelphia, PA 19122 Jonathan David Pro Signs 251 Boot Road Downingtown, PA 19335 Jack Protesto Reading Terminal Market Corporation 51 North 12th Street Philadelphia, PA 19107 Brent Cossrow Rodgers Insurance Group 651 Holiday Drive Pittsburgh, PA 15221 Laura Wehar Smartsite Strategies 610 West Main Street Ligonier, PA 15658 Ray Speicher The Social Merchant 503 South 5th Street Philadelphia, PA 19147 Jason Morgan Sprague Energy 2308 Shepherd Drive Northfield, NJ 08225 Michael Koob

Lodging Members High Hotels Ltd. Lancaster, PA Hilton Garden Inn Pittsburgh — Cranberry Cranberry Township, PA Microtel Inn & Suites Hamburg, PA Midway Holdings Bethel, PA Travelodge Lancaster, PA

GreenBrand Services 57 Hamilton Circle Philadelphia, PA 19130 Lorenz Coates

SUMMER 2013

Heineken USA 230 Kent Road Springfield, PA 19064 Jarett Raffel

VisitPittsburgh Pittsburgh, PA Wilkes-Barre Motel Association Wilkes Barre, PA

PENNSYLVANIA RESTAURANT & LODGING matters

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