Setai Hotel Exposed!

While Models and Celebs Luxuriate, Foreign Workers Suffer

By John Zur

Opened in 2005, The Setai, South Beach has enjoyed a run as one of Miami’s premier luxury hotels, exemplified for refined service indicative of its contemporaries in the Far East. However, beneath the surface lies a quite shockingly different experience for its employees.

It wasn’t until a recent exile from The Setai that several employees were open to talking. Compelled to shed light on the working condition they experienced, they especially wanted to bring attention to the treatment that employees as part of an exchange program – mostly from Indonesia – are enduring.

“I love my staff and they were a part of my heart,” says a former restaurant captain, Peter, who wishes to remain anonymous and preferred a pseudonym be used. Peter said that things weren’t always so bad at The Setai and that the beginning was a much different experience for him and his staff. “The developers (Jonathan J. Breene and John P. Conroy, Jr.) were amazing people. They treated the staff like gold,” he said. Peter then recalled an instance when the staff was invited to a barbeque by Breene and Conroy. They were “amazing people,” recalls Peter.

General Hotel Management LTd. (GHM), founded in 1992, is the management group of the hotel. With several hotels and resorts across Asia and Europe, The Setai is currently their only property in the United States. GHM’s portfolio includes hotels in Bali, Langkawa, Oman, Chiang Mai, Jordan, China, Thailand, India, Morocco, Andermatt, Vietnam, South Korea, Myanmar, and North Korea. With an extensive outreach and labor inexpensive, GHM ships students around the world, on visa, to their various properties.
The students, mostly age eighteen to early twenties, that are working at The Setai are from the aforementioned countries where GHM’s other hotels are located. They are part of the GHM Exchange Program. Their contracts with The Setai vary in length, as they use to eighteen months long and are now twelve months long.

The Setai also has a management trainee program in which they pair themselves with top schools in countries such as Switzerland, Germany, France, Italy, and the United States. This program, that hotel general manager Hansjoerg Meier calls “very successful,” offers individuals – ages twenty-four to twenty-seven – the opportunity to join the hotel, practice what they learned in hospitality school, and stay with the organization as department heads or assistant department heads following the eighteen-month program. The former and current employees, who spoke, detailed the treatment of the exchange program employees and not the management trainees.

Due to being frightened that their ability to work in the United States would be jeopardized, none of the exchange program participants agreed to an interview. However, several of their colleagues, with the legal ability to work in America, spoke.

Of the six current and former employees of The Setai who were contacted individually, each had precise information that they easily recalled concerning the work environment. And each account contained the same basic information.

The exchange program employees are housed at The Abbey Hotel (300 21st Street, Miami Beach). Four to a room, they sleep in bunk beds and share one bathroom. The Setai is also charges each student $300 to $600 per month for living accommodations at The Abbey, which includes a recreation room with wi-fi, two meals per day, television, and laundry facilities.

The students reportedly work unreasonably long hours against their will. In the restaurant industry, shifts including either breakfast and lunch or lunch and dinner are referred to as “doubles,” whereas “triples” are shifts that include all three meal periods.

“They are forced to work long hours, many double and triple shifts per week,” says Joe, a former restaurant server who agreed to speak so long as his first name is changed in print. When asked how many hours their staff is working, Meier and Xavier Vazquez, assistant director of human resources, agreed that full-time employees work at least thirty-two hours per week and that the hotel department heads try to guarantee at least forty hours. In the high season (about October to May), they conceded that many employees work in excess of forty hours per week; anything less would be deemed “unrealistic.” When asked if some employees are required to work upwards of sixty to seventy hours per week, Meier and Vazquez assured that employees are asked to put in additional hours for special events, overtime is paid, and that time off is properly assured. When asked if employees are forced to work triples against their will, Meier suggested that scenario is “more the exception than the rule,” going on to back up long hours at The Setai by proposing that “the majority of waiters have two jobs in Miami” and that it’s to the employee’s benefit to work overtime at The Setai because of overtime pay.

Joe continued, “If they choose not to (work doubles and triples), their employment can be terminated and they would therefore be deported within one week. The airfare for a ticket to Bali with one weeks [sic] notice is, in its own way, a threat.”

Threats seemed to be the controlling force behind keeping the employees – both exchange program employees and full-time staff – in check. Several claims were made that former department heads would threaten to send staff “back to their third world country,” as well as use derogatory language and make comments to the students such as “you should be working at Denny’s.”

Former executive chef of The Setai, Jonathan Wright, was contacted. He left The Setai in September 2010 for Sandy Lane Resort in Barbados. When asked for his thoughts on the student visa program, Wright responded, “It’s a phenomenal program. Quite successful,” but then added that he hasn’t “been there for a year.” He said that his departure from The Setai “was a career move.” When the topic of verbal harassment was brought up, Wright’s response was, “I find that very hard to believe.” And as far as verbal harassment coming from department heads, Wright offered, “Not that I’m aware.”

Vazquez was asked if such threats from department heads had been brought to his attention. He said that The Setai practices an open door policy and that “in the course of any investigation, there’s always situations that come up…” He says mentioning specifics would be a “disservice.”

“They’ve got these kids scared,” says Hilda, a former restaurant server of The Setai utilizing a pseudonym. “I called the labor board, but there’s nothing they could do unless one of the students (exchange program employees) called. But they wouldn’t call. It’s a sweatshop. And anytime someone put their foot down, they got fired.”

“When they fired someone, they ask them to quit,” says Joe. Mark, a server who worked in The Restaurant from October 2009 to September 2010, explained how he met his fate following a guest letter written to Meier complaining about the staff. As Mark was named in the letter, he was obligated to meet with Meier and human resources. According to Mark, the letter suggested that he, along with some of his colleagues, failed to adhere to the strict service guidelines according to Leading Hotels of the World. During Mark’s meeting with Meier, and Xavier Vazquez, assistant director of human resources, Mark claims that Meier blatantly suggested to him “you should be ashamed of yourself.” Meier then gave Mark an ultimatum: “I want you to resign. If you don’t resign, I will make sure you aren’t hired by any place you apply to.”

Meier maintained that Mark performed poorly, receiving many guest complaints. “He showed no interest in bringing himself up to standards.”  When asked if progressive action was taken in order to give Mark the opportunity to redeem himself, Vazquez said that they wanted to be fair to the organization and “respect our and his privacy.” When Meier was asked about the verbiage that Mark recalled him using, he replied, “don’t recall that… no.” When asked if he would ask for a resignation, Meier simply said, “Pass.”

“It’s falling apart at the seams,” says Mark. “They don’t have the money to buy stuff. There was a guest who had to leave the hotel to get a pen to sign their folio because there were no pens at the front desk.” Meier contends that such an instance could “absolutely not” have happened, adding that The Setai is standard driven. Regarding employees, Meier added that “some don’t have the basic understanding to serve people” and that if he were to be informed of such conduct, he’d ask the employee why they sent the guest to leave the hotel for a pen. Vazquez then lent a reminder that there are “other employees who have had a successful run.”

Apparently, the same powers that be, that didn’t have the money to purchase equipment, tapped into the staff of The Restaurant’s wallets to fund the hotel’s expenses. Each of the staff interviewed broke down how The Setai allocated the 20% service charge on each check.

“Hotel keeps 25% of tips to do as they please,” explained Joe. “Another 25% goes to pay the breakfast crew as they do not make enough from their low sales. Normally a hotel would pay AM crew a higher hourly rate. In addition, most of the morning staff is employed by the Setai as part of a worker-visa agreement that states that the hotel will withhold 20% of their pay, which may only be returned after they complete an additional year of employment at one of the company’s SE Asia locations.
“Another 1% from our sales was deducted for breakage, including anything broken by back of house staff. We were then told the 1% was to buy new supplies. Management changed their mind on the design of china, glassware etc. Our tips paid for that.” Vazquez claims that “each department has their own breakdown of the service charge,” based upon the “demands of each outlet” and what is “appropriate to the staff of the outlet.” That goes for taking 1% of total sales for broken glassware and china. A request for a copy of a blank tip sheet was denied.

“We were taking inventory of utensils, glassware, and linen on a nightly basis,” said Carlos, an ex-server who elected a pseudonym be used. Such extreme practices are uncommon in the food and beverage industry. Carlos, who spent a year-and-a-half working at The Setai, said, “Working there must have taken five years off my life with the stress I’ve dealt with. That company needs to have the curtains drawn back on it.” He also explained that during his tenure, The Setai owes him in the neighborhood of $15,000 to $20,000 after factoring how much of the 20% service charge didn’t actually make it into his pocket.

“There was a book that – after a day or two – you could see your cut of the tips,” said Mark, who added that as time went on and management turnover became an increasing issue, the book no longer became available to servers. As an example, Mark said there was a particular night where he had grossed $1,200 in tips, based on the 20% service charge, however he walked with $225 after The Setai “took their cut.” When asked if the servers challenged management about their tips, he said that he and everyone else were “met with excuses so staff would just give up the fight.”

“When they ask for the tips to be shown to them management says they are not required to show tips because upper management told them not to show us,” said a former server. “I demand my tips to be shown to me thru [sic] HR, I have the emails sent to HR, they show us we all [sic] for the month were missing tips. I was missing $350.00 worth of my tips and 16 working hours.” She also noted that overtime was never paid properly.

According to the employees interviewed, included in the tip pool are salaried employees. As there has been much turnover, especially at the management level in food and beverage, policies changed.  At one point, management was stretched so thin that the presence of a supervisor on “the floor” was not felt. Carlos said that in one instance a manager named Pierre was hired on a whim and fired shortly thereafter because he had lied on his application and his references didn’t check out. He said there was another manager, Fabian, who was hired and quit soon afterwards. Vazquez called the turnover “standard.”

Labor issues didn’t stop there. “They (The Setai) did away with the cleaning crew to save money,” said Carlos. “They replaced them with the Balinese which are normally just breakfast and lunch crew servers. It was a constant complaint from PM servers that the AM crew did not do their share of work. Management’s attitude was always that the AM crew had a considerable work load as it included painting and deep cleaning. This is normally outsourced.” Such duties the students performed included scraping and repainting the wood trim in the courtyard, cleaning windows, and deep cleaning the bar.

Carlos also noted, “The Balinese got together and went to HR to communicate the intense pressure they were under to fill in for the restaurant. The Restaurant at Setai is always short staffed because they cannot keep captains and servers due to the tip pool.”
Meier claims that the employees in food and beverage perform “typical” duties, including some that are janitorial in nature, but that no exchange program employee was brought in specifically to work as a janitor. He also offered that employees ask if they can do additional work, “to make a couple extra bucks.”

“The wait staff barely knew any english and rarely added water or changed plates. Given the obscene prices, after a certain point, we stopped getting mad and just settled into a bewildered amused state of mind, wondering how any restaurant could stay in business being run this way,” says one Yelp reviewer, dated 2/13/2011. When asked if the students on visa were set up for success in the United States, those interviewed unanimously agreed that it was a struggle. The students were used in various departments throughout the hotel.  In The Restaurant, because the majority of the students communicated in limited English, they were usually relegated to duties with less guest interaction such as tending to the breakfast buffet. However, when pressed into lunch or dinner service the students were oftentimes found acting as servers and taking orders and providing tableside service.  Despite the Yelp review and staff accounts, Meier said there is “no” barrier in English, and that “some people might have problems understanding my (Swiss) accent.”

Meier attributed the revelations by current and former employees as stemming from performance issues, claiming that many others are proud to work at The Setai. Said Hilda, “Guests have no idea what goes on behind the scenes there. I think it’s ridiculous for presidents to stay at a hotel that’s essentially a sweatshop.”

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