ISLAMABAD: Legal counsel for the Roosevelt Hotel has assessed the chances of successfully challenging an adverse arbitration award at just 1%, prompting the government to consider an amicable settlement with the hotel’s workers’ union to avoid costly litigation.
The counsel outlined three options: accepting the arbitration award at a cost of $11 million along with additional penalties of 15%, filing a petition in the District Court despite a 1% chance of success and the risk of additional fees if rejected, or negotiating a severance package with the workers’ union.
The dispute emerged after New York City terminated its Migrant Business Arrangement with the Roosevelt Hotel with effect from June 30, 2025. The arrangement, approved by the Economic Coordination Committee (ECC) in May 2023, had allowed the hotel to reopen following the Covid-19 pandemic.
The Hotel Trade Council subsequently filed a grievance, arguing that Roosevelt Hotel Corporation, a subsidiary of PIA Investments, had failed to reopen the hotel after the arrangement ended.
On November 19, 2025, the impartial chairperson issued an adverse award against Roosevelt Hotel Corporation, ordering that laid-off employees be restored and returned to the payroll effective January 1, 2026, resulting in additional financial costs.
PIA Holding Company has proposed filing an appeal in the District Court to have the award vacated while simultaneously negotiating a settlement with the workers’ union. The court case could be withdrawn if a settlement is reached.
A negotiating committee comprising representatives of the ministry concerned, Ministry of Finance, PIA Holding Company and Privatisation Commission has also been proposed, with the possibility of including US-based legal counsel.
The Ministry of Law and Justice endorsed the proposed approach, while the Attorney General’s Office also suggested pursuing negotiations in the interest of an amicable settlement and to avoid costly litigation.
