Terranea Resort in Rancho Palos Verdes fined $3.3M for labor violations

The state labor commissioner announced $3.3 million in fines Thursday against an upscale resort in Rancho Palos Verdes for failing to offer jobs to employees who were laid off during the COVID-19 pandemic once the hotel reopened.

The 53 employees of Terranea Resort included housekeepers, banquet servers and bartenders, junior sous chefs and massage therapists.

“These workers invested years of service at Terranea and through no fault of their own, lost their jobs due to the pandemic,” Labor Commissioner Lilia García-Brower said in a statement. “The law makes it clear that workers in the hospitality and services industries must be prioritized to return to the same or similar positions when their former employer reopens for business.”

Telephone and email messages seeking comment from a Terranea Resort spokeswoman were not immediately answered.

The labor commissioner’s office said it opened an investigation in July 2021 after receiving reports of violation from Unite Here Local 11 on behalf of 14 laid-off workers. The workers claimed they were not offered an opportunity to return to their jobs based on seniority when the hotel increased business operations in 2021.

The investigation included interviews with former and current workers, depositions from Terranea’s personnel managers and an audit of payroll records, according to the commissioner’s office.

The investigation determined that DH Long Point Management LLC — doing business as Terranea Resort — had violated the Right to Recall law and cited the hotel $3,080,000 in liquidated damages, $5,300 in civil penalties and $208,582 in assessed interest for a total of $3,293,882.

The law entitles each worker whose rights are violated liquidated damages of $500 per day until the violation is resolved and civil penalties against the employer of $100 for each employee whose rights are violated. Any employee suffering unlawful retaliation for asserting recall rights may also be awarded back pay, front pay benefits and reinstatement.