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4
November 17, 2016
Via Electronic Mail

Councilmember Robert C. White Jr., Member, Committee of the Whole Subcommittee on Workforce
Council of the District of Columbia, 1350 Pennsylvania Avenue NW, Suite 107, Washington, D.C. 20004
Councilmember Elissa Silverman, Chair, Committee of the Whole Subcommittee on Workforce
Council of the District of Columbia, 1350 Pennsylvania Avenue NW, Suite 408, Washington, D.C. 20004
Councilmember Charles Allen, Member, Committee of the Whole Subcommittee on Workforce
Council of the District of Columbia, 1350 Pennsylvania Avenue NW, Suite 406, Washington, D.C. 20004
Councilmember Brianne Nadeau, Member, Committee of the Whole Subcommittee on Workforce
Council of the District of Columbia, 1350 Pennsylvania Avenue NW, Suite 102, Washington, D.C. 20004
Councilmember Brandon T. Todd, Member, Committee of the Whole Subcommittee on Workforce
Council of the District of Columbia, 1350 Pennsylvania Avenue NW, Suite 105, Washington, D.C. 20004

RE: Committee of the Whole Subcommittee on Workforce Request for Additional Data and
Information Regarding District of Columbia Local Private Sector Hospitality Business
Employment Decreases, JanuaryJuly 2016 and Year-to-Date

Councilmember White, Subcommittee Chair Silverman, and Subcommittee Members:

Thank you for allowing the D.C. Nightlife Hospitality Association (DCNHA) to present testimony at the
recent D.C. Council Committee of the Whole Subcommittee on Workforce Public Roundtable to discuss
considerations and concerns regarding potential Council re-consideration of mandated employer
scheduling requirements and employee hiring restrictions in the next Legislative Period.
DCNHA very much appreciated the insightful comments and thoughtful follow-up inquiries proffered by
Councilmember White related to the oral testimony presented by the association at the Nov. 3 public
roundtable. During that interrogatory, a request was made to provide additional information regarding
the notable recent and significant decline in employment among hospitality establishments in the
District, as reported by the federal Bureau of Labor Statistics (BLS).
I take this opportunity to provide that requested information, which will be additionally submitted for
the public record to supplement our filed public roundtable testimony written statement.
In our testimony, DCNHA pointed out for the benefit of Subcommittee consideration the following
statistical data from the BLS:
In the first six months of this year, from January 1 to June 30, food-and-alcohol-serving
establishments in the District registered a 2.7% drop in employment. This has occurred
despite the growing number of local venues. In only 26 weeks, a total of 1,400 jobs have
been eliminated. This startling drop in local employment levels represents eight (8) jobs
lost every day of each week.
This dramatic decline in local sector employment is illustrated in the contemporaneous public media
news journal report data chart showing the drop in D.C. hospitality jobs in the first six months of this
year in comparison to consistent growth since 2010, as additionally contrasted with regional sector
employment statistics, shown following:
continued

Page 2

Bureau of Labor Statistics (BLS) Employment Data for D.C. Food Service and
Drinking Places, Jan. 2010 July 2016, Seasonally Adjusted, and as compared to
regional employment for the business sector (via news media data chart graphic)

NOTE: While the news media public source reporting highlighted in the above data chart graphic emphasizes
by notation the impact of increases in the local minimum wage as a contributing factor to the sudden drop in
hospitality sector employment, DCNHA takes this opportunity to remind Councilmembers that the association
did not oppose the recent passage of further increases in the local minimum wage, but did recommend in
public hearing testimony and Council correspondence that the phase-in schedule to a $15 per hour minimum
wage be lengthened to mitigate the known negative impacts on employment and, in particular, employment
opportunities for lower-skilled and entry-level job-seekers who would be most affected by rising labor costs.

As shown, the BLS reported 52,400 jobs at food service and drinking places in the District at the first of
the year, declining to 51,000 six months later, or a loss of 1,400 positions, and despite growth in the total
number of local licensed establishments.
This decline is the single largest decrease over a six-month period in 15 years, since 2001, for staffing
levels at hospitality sector establishments in the District. Most alarming is that this drop in the number
of business sector jobs was evidenced despite continued growth in the aggregate number of local venues.
Since that time, newly-updated hospitality sector employment figures for the District for the period to
October show a slight subsequent uptick in jobs but only partial recovery in the number of hospitality
sector jobs eliminated, to a new total of 51,800 positions. This modest recovery in sector employment,
however, is largely and likely primarily attributable to an increase in the total number of venues and
does not reflect a remedial increase in the number of positions at previously existing establishments.
continued

Page 3

In addition, employment at the robust number of newly-opened establishments beginning operation in

the period since July, presumably accounting for the only partial recovery in total sector employment, is
also presumed to reflect suppressed hiring in the number of positions at new venues due to the same
factors affecting pre-existing establishments and resulting in a notable overall decline in jobs-per-venue.
These factors result in a continued drop in total employment for the period, producing a year-to-date net
loss of 600 positions in the local hospitality sector, despite the known and notable increased number of
employers, as shown following:

Bureau of Labor Statistics (BLS) Employment Data for D.C. Food Service and
Drinking Places, Year-to-Date: Jan. 2016 Oct. 2016, Seasonally Adjusted (via
Federal Reserve Bank data chart)

This decline in total employment for the local food service and drinking places business sector for the
year-to-date period is highly significant and should be a cause for worry among D.C. Councilmembers
and District officials especially as it represents a first-ever sustained decline in 15 years of employment
data. The fact that these job losses have occurred despite continued growth in the number of businesses,
indicating a notable drop in actual per-venue employment as a consequence, is particularly troubling.
To provide an appropriate comparison with the first data chart shown above (see page 2) inclusive of
data originating January 2010 and with additional sector employment statistics subsequent to June and
through September, the year-to-date decline in the number of jobs at District hospitality establishments
is shown here on a five-year continuum of employment data for the sector, as shown following:
continued

Page 4

Bureau of Labor Statistics (BLS) Employment Data for D.C. Food Service and
Drinking Places, Jan. 2010 Oct. 2016, Seasonally Adjusted (via Federal Reserve
Bank data chart)

___________________________________

The Current Decline in Local Hospitality Employment in the District Represents

Both the Single Largest Decrease in the Total Number of Jobs and for the Longest
Sustained Period as Measured Against the Last 15 Years of Statistical Data
As noted earlier, the current decline in sector employment is the single largest decrease and sustained
decline in the number of jobs over a similar period during the past 15 years, since 2001.
A modest partial recovery in the aggregate number of hospitality sector employment jobs is undoubtedly
due to a plethora of new establishments opening during the late summer and early fall period, easily
accounting for the indicated small and only partial recovery in total staff positions since the sudden
decrease in sector employment throughout the period January to July.
For that reason, the statistical evidence clearly suggests that the decline in sector employment is both
significant and not improving overall, given that the only partial year-to-date recovery in total jobs is due
to an increase in the number of employers.
This 15-year continuum of data is shown following:
continued

Page 5

Bureau of Labor Statistics (BLS) Employment Data for D.C. Food Service and
Drinking Places, Jan. 2001 Oct. 2016, Seasonally Adjusted (via Federal Reserve
Bank data chart)

In addition, it is important to note that the decline in full-time positions may actually be larger, masked
to a degree by the hiring of personnel for part-time positions or the conversion of previously full-or-
near-full-time positions to part-time positions in order to provide employers with greater staffing
flexibility among a reduced number of employees. Establishment operators commonly find this
necessary to meet practical and functional staffing requirements, causing a reduction in either or both
the total number of employees and the number of full-or-near-full-time employees. This is the case
particularly at D.C.s typically small business establishments with modest staffs and an even greater
necessity to utilize a staff complement tailored for commonplace staffing needs and scheduling variables.

What Has Caused this Sudden and Historic Decline in Local Hospitality Sector
Employment for Eating and Drinking Establishments in the District?
While there are often a range of factors contributing to both lesser and greater degree in such situations,
it is clear that this substantial and historic drop in employment data for food service and drinking
places in the District is definitively not due to a decrease in either the number of establishments or
aggregate sales figures for local venues, both of which have continued to increase during the period.
continued

Page 6

What is abundantly clear, based on indications from DCNHA Member establishments and as discussed by
local hospitality operators throughout the District, is that recent and continuing increases in labor costs,
expenses related to new regulations and legislative mandates, and proposed new costs and taxes
notably the looming potential passage of a unique-in-the-nation business tax on employer wages to
fund a city-administered employee paid leave program have caused operators to act definitively and
decisively to accommodate and anticipate the resulting cumulative financial impact on their businesses.
These accelerating new expenses associated with conducting business in the District are causing
hospitality employers to both absorb higher current costs and preemptively price-in pending and
potential new costs. As a result of industry labor costs in the range of 33%-to-40% of total revenues, and
due to the razor-thin operating margins of hospitality establishments, local operators are beginning to
make hard choices about staffing levels as a primary cost-cutting necessity. Something has got to give.
Due decisions by D.C. elected officials which serve to further compound these direct and indirect new
operating expenses and costs through legislative mandate and regulation, we fear further deterioration
in employment levels for the hospitality sector in the District despite aggregate growth in new venues.
The economic reality for local hospitality operators increasingly requires reduction in staff positions to
balance the bottom line, and is resulting in a wholly counterproductive decrease in sector employment
within the District that the employment data for our citys bars, restaurants, and nightclubs now
evidences by the statistics we have presented here in response to a request for additional information.
We trust that you will find these facts and figures as instructive as they are for us, and hope that you will
consider these stark employment realities and job-loss results when considering legislation further
adding to the burdens of conducting business in the District.

Mark Lee, Executive Director
D.C. Nightlife Hospitality Association (DCNHA)
Mobile 202-320-4911
___________________________________________________________

Attached: D.C. Nightlife Hospitality Association (DCNHA) Testimony, November 3, 2016, Public
Roundtable of the Committee of the Whole Subcommittee on Workforce: Subcommittee Roundtable on
Fair Scheduling Issues in the District of Columbia, Written Statement
___________________________________________________________
cc: D.C. Council Committee of the Whole Subcommittee on Workforce Member Chiefs of Staff and
Legislative Staffmembers
cc: D.C. Council Chair Phil Mendelson and Additional Members of the Council of the District of Columbia,
and Council Chair and Additional Councilmember Chiefs of Staff and Legislative Staffmembers
__________________________________________________________________________

D.C. Nightlife Hospitality Association (DCNHA) is a 501(c)6 nonprofit trade association and
business membership organization representing bar, restaurant, nightclub, and entertainment venues
contributing to a vibrant community nightlife and dynamic nighttime economy in the nation's capital!
D.C. Nightlife Hospitality Association (DCNHA)
PO Box 73294, Washington, DC 20056-3294
__________________________________________________________________________

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PUBLIC ROUNDTABLE TESTIMONY
COUNCIL OF THE DISTRICT OF COLUMBIA
COMMITTEE OF THE WHOLE
SUBCOMMITTEE ON WORKFORCE

FAIR SCHEDULING ISSUES IN THE DISTRICT OF COLUMBIA

MARK LEE
EXECUTIVE DIRECTOR
D.C. NIGHTLIFE HOSPITALITY ASSOCIATION
(DCNHA)
November 3, 2016

D.C. Nightlife Hospitality Association (DCNHA) is a 501(c)6 nonprofit trade association and business
membership organization representing bar, restaurant, nightclub, and entertainment venues
contributing to a vibrant community nightlife and dynamic nighttime economy in the nations capital!

!"#$% !!"! #&'()*&+,-$./0&)1*&)2-%//.3&1)&.4

Chairperson Silverman, Council Members, Council and Subcommittee Staff:
My name is Mark Lee and I serve as Executive Director of the D.C. Nightlife
Hospitality Association (DCNHA), a nonprofit trade association representing local
bar, restaurant, nightclub, and entertainment venues of all types and sizes,
located throughout the city, and contributing to a vibrant community nightlife
and dynamic nighttime economy in the District.
Hospitality is the largest hometown private sector business category and a
primary employer, leading job creator, major tax revenue contributor, key
economic development generator, and provider of the popular dining, drinking,
and socializing amenities that both enliven community life and contribute to
building strong neighborhoods.
Nightlife establishments are proud to be a signature source of nourishment for
the social and cultural soul of our great and growing city.
Any discussion of new regulatory mandates for local employers must be placed in
context. The dismaying tendency of some to rush toward further restrictions on
standard, reasonable, and fair operating practices, as well as imposing new costs,
adding new burdens, and levying additional taxes comes with a price for which
many seem blissfully unaware. The District is barreling toward breaching an
imbalance that will result in an gradually accelerating spiral of economic decline.
For the small business hospitality community, that day of reckoning is already
here. As local establishments begin to price in the plethora of never-ending new
regulations and costs, the Bureau of Labor Statistics has provided a clear warning.
In the first six months of this year, from January 1 to June 30, food-and-alcohol-
serving establishments in the District registered a 2.7% drop in employment. This
has occurred despite the growing number of local venues. In only 26 weeks, a
total of 1,400 jobs have been eliminated. This startling drop in local employment
levels represents eight (8) jobs lost every day of each week.
The real question that should be asked today is a simple one: How many more
jobs do you intend to eliminate?
The prior protracted and failed effort by the Council to legislate what small
business operators refer to as a Restrictive Scheduling and Restrictive Hiring
measure serves to illustrate the difficulty of mandating business operations in
these areas, as well as the perverse negative effects such attempts will produce.
2

To be clear, that failed legislative attempt would not have applied to any local
small business hospitality establishments anywhere in the city. The independent
local restaurants, bars, and nightclubs across the District, however, clearly
understand that they will soon become the next target.
Legislation targeting national corporations and franchise operators will almost
certainly lead to eventual expansion of the mandate to all workplaces in the
District. The claim will be made, based on the intrinsic ability of larger businesses
to more easily absorb the costs and complexities, no harm will come by extending
the mandate to local small business operators.
Thats when you will come after us local hospitality venues with small staffs,
frequent business fluctuations, complex staffing situations, and little ability to
absorb yet another source of increased operating costs.
We know it, you know it, and everyone else knows it.
For those reasons, we are here today to share our concern and the very real
alarm in the local hospitality community regarding ill-advised attempts to
further legislate in this area and the inevitable expansion of new mandates.
We believe that advocates of legislation of this type have failed to demonstrate
sufficient cause to warrant reviving an attempt to legislate in this area of
employment regulation.
First, although so-called on-call scheduling is not a prevalent practice in the
local hospitality business sector, we believe that current D.C. law guaranteeing a
four-hour wage payment provides adequate protection and fair compensation in
instances when an employee reports for a scheduled shift when inadequate work
is available or work is available for fewer hours than scheduled.
More than that, consistent scheduling on a weekly basis is the common standard
at local bars and restaurants. Most scheduling changes, in fact, are initiated by
employees and are typically accommodated on an informal basis within staffing
segments between employee and manager. Informal transactional adjustments
are accomplished without much fuss.
One of the trademark attractions of hospitality employment is the opportunity to
work flexible hours with an inherently greater flexibility to accommodate staff
scheduling requests than in most other areas of employment. National surveys of
hospitality employees indicate overwhelming job-satisfaction and employee
appreciation of the ability and opportunity to adjust scheduling obligations as
needed.

Requiring a convoluted process and retained paper trail for every employee
scheduling adjustment or employer scheduling change will result in a decreased
ability to provide scheduling flexibility for employees while also accommodating
employer requirements.
Second, it is unrealistic to expect hospitality venues to fully predict two or three
weeks in advance what every supplemental staffing requirement will be. Forcing
businesses to unnecessarily schedule and compensate unneeded shifts is a
significant financial hardship measured against razor-thin operating margins.
Hospitality venues are subject to fluid business variances not in their control. Late
scheduling of event bookings, last-minute reservations, or special events at other
nearby businesses can easily affect business volume. Nightlife establishments
may not know what attendance will be until ticket sales are known.
Third, hospitality businesses are startled by the attempt to force conversion of
part-time positions into full-time positions by prohibiting the hiring of new
employees prior to a required delay and offers to all existing staff. This mandate
represents an astonishing governmental arrogance and intrusion into the
management of private businesses. It is also entirely inconsistent with the unique
staffing configurations characteristic of restaurants and bars and commonly
required for similar small-staff workplaces to achieve operational needs.
Worst of all, the proposed rules will actually result in negative implications and
actual earnings reductions for employees.
Overstaffing is not feasible establishments cant afford the increased costs and
tipped servers and bartenders will be harmed by reduced income if gratuities are
spread among an unnecessarily oversized number of staff.
Whats more likely is that understaffing will become the norm, with employees
enjoying close-to-home proximity and flexible personal schedules voluntarily
checking in to see if additional staff is required. This protocol will result in some
workers receiving fewer scheduled shifts and earning less income.
There is also a fundamentally unreasonable assumption in prior proposed
legislation requiring employers to pay a wage differential to employees for
working shifts made necessary by the automatic ability of other employees to
demand scheduling adjustments. Once an employee requests an adjustment
within the timeframe of a required advance staff schedule release, an automatic
wage differential would apply for the required scheduling of a replacement. It is
not difficult to imagine mischief in scheduling change requests as a result.

In the local region, the Maryland state legislature last year had the good sense to
reject measures that some seek to enact here. District elected officials should
follow the commonsense lead of our neighbors to the north.
We continue to be dismayed by the tendency of some Councilmembers to
continually seek enactment of the first-or-the-worst legislative measures by
proposing the most notoriously business-unfriendly laws in the country. This is
another one of those instances.

_________________________________________________________________

D.C. Nightlife Hospitality Association (DCNHA)

PO Box 73294, Washington, DC 20056-3294
Mark Lee, Executive Director
MarkLee.DC@verizon.net
202-320-4911