Hyatt Hotels is facing a major public relations problem because it decided to replace its housekeeping employees in three hotels in Boston with contractors provided by an outside agency.   The hotel made its decision for economic reasons:  its housekeepers earned $14 to $16 per hour plus benefits, while their replacements make about $8 per hour without benefits.    There are also allegations (which Hyatt denies) that the company misled its employees, instructing them to train the replacements without telling them they would be taking over their jobs, and having them empty out their lockers for “cleaning”.   To its credit, Hyatt is extending health benefits for the laid-off employees to the end of the year, and setting up a task force to help in other ways.

Everyone from Massachusetts Governor Deval Patrick to 1400 Boston cabbies has threatened to boycott Hyatt because of the layoffs.

A classic example of the “damned if you do, damned if you don’t” dilemma that many employers find themselves in during tough economic times.