Management of the Pacific Beach Hotel will change hands for a second time this year in December, and that has many employees concerned because they have not been told how many of them will be rehired by the new management firm.

Hotel owner HTH Corp. announced yesterday that it was ending its contract with PBH Management LLC to manage the 837-room Waikiki property effective Dec. 1. Operations of the hotel will return to HTH Corp. through its management affiliate, Pacific Beach Corp.

PBH Management is an affiliate of Outrigger Hotels and has been running the hotel since Jan. 1. Hotel management spent most of yesterday meeting with the 535 employees to discuss the change.

PBH Management yesterday filed a notice with the Department of Labor and Industrial Relations as required by law that all employees will be terminated on Dec. 1. But it was not known how many of the workers will be retained by Pacific Beach Corp.

Robert "Mick" Minicola, HTH Corp. regional vice president, would not comment on what will happen to the employees come Dec. 1. Until that date, Pacific Beach Hotel employees work for Outrigger, he said.

"We need to wait to find out what Outrigger will do because they have multiple properties and we need to understand their plans first," Minicola said. "We also have to be careful that if there are other people interested in working that we won't be prejudiced and not give them an opportunity as well."

Mel Wilinsky, executive vice president of PBH Management, said Outrigger has no control over who Pacific Beach Corp. decides to hire, although he said he hopes all employees will be retained.

"They're fine people and we would certainly hope that the new employer will take them on," he said. "I can't see why they wouldn't."

Hawai'i has no law to require an incoming management or ownership team to retain any of the employees under a previous company, said James Hardway, spokesman with the Labor Department.

HTH's lack of commitment to rehire the workers has raised concerns at the union that represents the employees.

Dave Mori, International Longshore and Warehouse Union Local 142 O'ahu division director, said before the management change in January, HTH and Outrigger assured workers that everyone would be retained.

Mori said it would be the "decent" thing for the incoming management company to do the same.

"These are the same employees that they had no problems with eight months ago," Mori said. "All they did was go through a 'laundry process' and now they're technically Outrigger employees."

The management change comes during labor unrest at the hotel, which has been owned by HTH since 1970. Three years ago, hotel workers voted to be represented by the ILWU, but the union and management have yet to come to a contract agreement.

The two sides have reached tentative agreements on several issues, but it was not immediately clear whether Pacific Beach Corp. will be required to honor those agreements. Minicola declined to comment on the contract.

But Mori said he believes HTH Corp. and Pacific Beach Corp. are effectively the same entity and should be required to honor agreements with the union.

Mori said the union and employees began to fear that something was in the works when PBH canceled the last two contract talks with no explanation. He said the two sides had been making progress and he was surprised when negotiations came to a halt.

Wilinsky said it was HTH's decision to sever ties with Outrigger and he received word last week on the decision.

Neither Wilinsky nor Minicola would comment on what led to the decision.

"Our understanding is that they feel at this time they were in a better position to focus on this hotel and have decided that they would prefer to move forward with their management instead of ours," Wilinsky said. "We're certainly not a party to their deliberations."

Minicola said the decline in hotel occupancy and revenue played a role in the change.

"It was just in the best interest of both companies," Minicola said. "It's no surprise to anyone that the business economics of Waikiki has been suffering this year versus previous years. There's been a lot of changes in the overall performances of Waikiki versus what we've had in previous years. With the downturn, both companies decided to review their agreements and we're very excited to take over operations as of Dec. 1."

Reach Curtis Lum at culum@honoluluadvertiser.com.