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Hotel workers' benefits limited

Former Otaka Inc. employees of the Hawaiian Waikiki Beach Hotel will receive only partial severance and vacation pay as ordered by a judge on Tuesday.

Circuit Judge Karen Blondin limited benefits to severance and vacation earned for service while the hotel was in receivership. The judge ruled that benefits attributable to service performed prior to receivership will not be paid from the receiver's estate.

Blondin placed the 714-room hotel in receivership last August after ruling that Otaka had used money improperly and defaulted on loan payments. As a result, about 270 employees lost their jobs Saturday.

Union officials sought payment of more than $2 million in severance and vacation pay for hotel workers, including some with more than 20 years service.

Aston Hotels & Resorts began managing the property Sunday for New York financial services holding company Leucadia National Corp., which acquired the hotel at foreclosure.

Aston hired about 100 people, including about 20 former Hawaiian Waikiki workers, to run the newly named Aston Waikiki Beach Hotel while it undergoes a major renovation.

Hawai'i defense spending soars

Defense expenditures in Hawai'i rose in fiscal 2000 to a record $4.4 billion, an increase of 5.1 percent over the previous year, according to statistics released yesterday by the state.

The year-over-year rate of increase was the fastest since 1985, according to the state Department of Business, Economic Development and Tourism.

Military expenditures made up about 9.8 percent of the gross state product last year, according to department figures.