Pandemic Layoffs: Hotel to Pay $2.75M to Ex-Employees Denied Opportunity to Return to Work

When layoffs occur, the immediate concerns are often understandably front and center. But employers also need to take a longer view of the compliance obligations that can arise before, during and after a workforce reduction. 

A recent settlement out of California shows how costly it can be when employers overlook applicable recall requirements.

Pandemic Layoffs Hit Hospitality Hard

The California Labor Commissioner’s Office (LCO) received complaints from former employees of the Anaheim Marriott Hotel who were laid off during the COVID-19 pandemic. The workers said they weren’t recalled when positions became available. 

In 2021, California enacted SB 93, the state’s Right to Recall law, in response to pandemic-related layoffs that disproportionately affected certain industries, including hospitality. The law is scheduled to sunset on Jan. 1, 2027.

The law required covered employers to rehire eligible employees based on seniority before hiring other applicants. To be eligible, former employees had to have:

• Worked for the employer for at least six months
• Lost their jobs due to the pandemic, and
• Been qualified for an available position.

After an investigation, the LCO determined that eligible workers didn’t receive recall offers based on seniority, as required by law. The Anaheim Marriott Hotel then agreed to pay $2.75 million to resolve claims involving 24 former employees who said they were denied the right to return to work.

More info: LCO News Release 2026-64