Contract Refresh

In a response to the SARS-COV-2 (aka COVID-19) Pandemic, Meeting/Event Industry Leaders and Hotel Professionals have found themselves rethinking contract verbiage for hotels and contract service providers. 

Many Event/Meeting Professionals have language they prefer in their contracts and third-party, commissionable and fee-based, companies work to protect their clients with the best negotiated clauses possible. 

I queried industry professionals and received great in-put from two trusted colleagues, Geralyn Krist, CMP, Global Account Executive with ConferenceDirect, and Joan Eisenstodt, Eisenstodt Associates LLC, a meeting and hospitality consultant. 

These considerations are not inclusive. Neither of the contributors or I are legal professionals. This is meant to spark conversation about what you will want to consider negotiating for future meeting and event contracts. As always confer with hospitality legal counsel before attempting to negotiate any clauses that may be new to you.

Frustration of Contract/Purpose

One of the most touted phrases in new contracting is “frustration of purpose”. This contractual point has been used (successfully and unsuccessfully) in a variety of ways in the past and individuals are exploring what they will look like in the future. 

Include a statement of purpose in your contract. This would be a paragraph or two about the purpose of the contracted event (education, networking, continuing education credits).  When this information is provided, it could add teeth to a discussion about the impossibility/impracticability of performance and frustration of contract/purpose.

Duty of Care

Include staff/performance clauses in every contract. Ask: Is the hotel or other venue testing staff and contractors who enter the hotel for COVID-19? How will the venue handle an outbreak at the property? If a guest is isolated/quarantined, who pays for the isolation expenses (room, food and beverage)? 

Consider adding a cleaning clause to your contract, use CDC, State and Local Health Department guidelines as a template for your verbiage, and/or one that the hotel/venue has created. IAVM is an excellent resource for more information.

Make a list of your questions to be considered as you think about a duty of care provisions. 

Capacities and Historical Expectations

It is expected future meetings will be smaller either because occupancy capacity is restricted or desired by participants and/or sponsors or because participants’ travel budgets have decreased. Include a review clause for your contract with solid timelines and measurements to discuss capacity required or desired and conditions under which they will be governed. Be realistic! A contract should protect ALL the parties in the contract.

Rebooking Clauses

In the event a program is not able to occur by no fault of the group (ie. COVID-19 made holding a meeting impossible) the client has a specific number of days to shift event to alternate dates, if available and agreed to; this clause should also include the conditions for deposits. 

Detached Meeting Facilities

Include an “unavailability of other facilities” clause if you are using any additional facilities such as a convention center or other venue. This may allow for termination of your hotel contract should your primary event space become unavailable.

ADA Compliance

These clauses should always be included and reviewed. With the new contactless expectations, it will be important to highlight how a hotel will handle specific needs of persons with disabilities. 

Other Service Providers

After a year of losses, convention services providers will likely negotiate contracts well in advance of previous timelines. Think through and be prepared to respond. Will you agree to contract transportation provider, speaker, decorator and destination management company services more than twelve months in advance of the event’s first day? What expectations will you have/agree to for that contract?

Communicate

Everyone agreed that open and honest communication is critical.   If your main contact becomes unavailable, immediately request another contact even if the expectation is that yours will return. Be diligent until you have an established relationship in place. 

Additional Assistance

Having a professional who can assist with contract negotiations provides added strength to your team. These professionals typically have years of contracting experience, long-standing relationships with leaders at the national and hotel level in addition to the destination management organizations. Third party agencies will leverage relationships to strengthen contracts and be an advocate when any conflicts with providers arise. Most importantly, contract with a hospitality attorney. Regardless of how good any meeting practitioner is, legal counsel will know best!

Expect changes, spend a healthy amount of time reviewing your contract and be prepared with a response about what you will need/allow for when unexpected circumstances arise. Above all, keep the conversation open, honest and reflective of both the vendor and your organization’s needs.