HILO, Hawai'i — Nearly 120 unionized hotel employees finished their last day of work yesterday at Hilo's Hawai'i Naniloa Resort as a new owner took control of the state lease for the hotel, and rehired only about 20 of the hotel employees.

ILWU Big Island Division director Richard Baker said incoming owner Hawai'i Outdoor Tours Inc. wants to drive the union out by refusing to hire most of the former hotel workers.

Baker said that is the first time he can recall that the union, on the Big Island, has been forced out of a major hotel operation. The ILWU represents about 4,000 Big Island hotel workers.

Angry workers at the hotel yesterday said the state was too generous in granting time extensions to Hawai'i Outdoor Tours as the locally owned company delayed closing the deal.

To assume the new 65-year lease for state land under the Naniloa and the Banyan Drive golf course, Hawai'i Outdoor Tours agreed to pay $6.1 million to current hotel owners Hawai'i Naniloa Resort LLC, and pledged to make at least $5 million in improvements to the property over the next five years.

Kenneth Fujiyama, president of Hawai'i Outdoor Tours, was the high bidder for the property in a September auction, agreeing to pay the state a base lease rent of $500,000 a year or 2 percent of gross revenue, whichever is greater.

The union on Tuesday sued the state over the deal, alleging state officials used an "irregular" bid process because the state repeatedly extended the deadline to close the deal that transferred the lease to Hawai'i Outdoor Tours.

The Naniloa employees were repeatedly notified their jobs would end, only to be called back in to work after the supposed termination dates.

Some employees skipped job interviews or delayed taking new jobs to go back to the Naniloa because workers who failed to show up at their Naniloa posts stood to lose severance payments and vacation pay, Baker said.

Peter Young, Department of Land and Natural Resources chairman, declined through a spokesman to discuss the extensions the state granted, the ILWU lawsuit or the staffing issue at the hotel, saying those subjects should be addressed by Fujiyama.

Fujiyama did not respond to calls from The Advertiser Tuesday or yesterday.

"Why is the state allowing this to go on?" asked restaurant busperson Joann "Jojo" Gumahad, 33, after a meeting between the union and the workers at the hotel yesterday. Gumahad, who worked at the Naniloa for eight years, complained the state seemed indifferent to the problems of the hotel workers.

"We're being treated like dogs, I feel. Like dogs on a leash," she said. "Come when I need you. Get back in the dog house when I don't need you."

Leilana Ronquillio, 29, said in her six years at the hotel she learned everything from bookkeeping and banquet work to pool maintenance and staffing the front desk.

"I basically feel like I grew up here," she said. "It was not like a regular job, it was like a family."

Ronquillio, who has five children, said she will look for work in Hilo, and will commute to Kona to work if she must.

Ilona Makanani, a maid who completed 12 years at the hotel yesterday, wanted to know why the state granted extensions to Hawai'i Outdoor Tours.

"If they didn't give him the extension, we could have had the other two bidders come in, then maybe we could have still had our jobs. That's what we were looking for."

Reach Kevin Dayton at kdayton@honoluluadvertiser.com.