It seems that everyone in the city loves to pick away at the margins of a hospitality owner. New York—especially New York City—red tape has made it very difficult to turn a profit. One of the best ways to maintain, and hopefully build upon, the already-thin margins permitted is to remain compliant with state and city regulations. As with most things, it is important to tend to the minutia. In other words, the devil is in the details.
Recidivist non-compliance can snowball into draconian fines. For those that have a hard time tending to the sea of regulatory rules placed upon NYC bars and restaurants, penalties mount with seeming malice. In fact, NYC has developed a multi-department “raid” that is organized and executed against businesses that field repetitive noise complaints, food complaints, or Department of Health (DOH) violations. In one wonderful juggernaut, these agencies will descend upon the instigator:
•Department of Health;
•Department of Buildings;
•NYS Liquor Authority; and sometimes, just for good measure, they’ll toss in the
•Federal Alcohol Tobacco and Firearms Agency (ATF).
And they aren’t subtle. Representatives from each agency all roar into the targeted place of business, most often during a high-volume time and day. Then, it basically becomes an inter-agency competition to see who can write the most tickets. (You can imagine how good just their presence during the inspection is for business.)
These multi-agency raids most often descend upon establishments slanted more towards the bar end, live music, cabaret, dancing, and club scene—especially in the new, whitewashed version of New York City—but it can happen to anyone. There is a multitude of items that owners need to attend to, details that are so easy to overlook when trying to keep customers happy and tending to the endless minutiae of running a space.
1. Get a Pre-Inspection
A pre-inspection is an initial “fake” inspection, offered through the city, where an actual inspector schedules an “inspection” and uses the opportunity to point out current deficiencies. Take advantage of the pre-inspection and the available DOH literature.
2. Stay on Top of the Health Codes
It should be mandatory for every manager to review and remain abreast of the rules. It’s easy to become apathetic and lazy, and then all of a sudden, due to fines, the additional price of doing business becomes 3, 4, 5, or even 6 thousand dollars every 3-6 months.
For example, if your business serves beer or soda, you have compressed gas canisters in your facility. Those have to be chained to the wall. If you just have them leaning against the wall or otherwise not properly secured, the fines are significant.
Another example: Fire extinguishers have to be kept up to date. You can’t just not have them or buy them and forget about them. They must be refilled, re-registered and retagged every year. They can’t be thrown in a corner. They must be stationed at a certain height, must be visible and properly distributed throughout the facility. It’s also necessary to research how many you need given your square footage. Take advantage of any opportunity to consult the local fire department.
3. Double Jeopardy
If your business has a license to serve alcohol on-premise, then be prepared for the ignominy of permitted double jeopardy convictions. Violations that you receive from the police are not only answerable in criminal court, but you have to then re-answer them, vis a vis the state, through the New York State Liquor Authority. So you often get hit twice for every ticket you receive.
Proprietors often think to hang curtains, they’re beautiful, they look nice, and they can often add to the warmth of the interior. Know that any fabric in a commercial space needs to be fireproof. Specific companies handle the task and then provide a dated affidavit in which they swear it’s been properly executed.
If you have security guards, there are additional regulatory concerns. Each guard is required to have and carry their own license. Further, the employer, if the bar or restaurant itself, must register with NY State as a licensed security guard employer. There are also general liability insurance concerns to address.
The laws regarding emergency and exit lighting can seem designed to generate fines for the city. It is necessary that staff is on top of these items on a daily basis. Schedule a dedicated daily walk through, testing all bulbs, emergency lights, and exit sign lights.
Another understandable and very important safety regulation is the strict rule against deadbolts on exit doors. This rule is designed so that, in the event of a panic, there will not be any bottlenecks at the points of egress.
7. Record Keeping
All businesses are required to keep their employee records and invoices on site. That encompasses everything that you do maintaining operations; liquor orders, employee contracts, W-4s, I-9s—all paperwork must be maintained on site and demonstrable upon request.
New York is known for its world famous restaurants and nightlife. As we’ve seen in this article, and we’ve only touched the surface, there is an enormous bit of background work that goes into providing great experiences for your patrons. With shrinking profit margins across the industry, it not only pays to innovate your way to success but also to have the sound legal advice of an experienced attorney who specializes in the hospitality industry. To learn more, contact me here.