An industry attorney shared tips on contracting and all things legal in a recent webinar for incentive planners. Here are some of the top tips he shared.

Today’s incentive planning landscape is rife with challenges, from increased U.S. entry fees to increasingly stringent contracting terms to a wider range of security concerns. To help incentive professionals wade through the increasingly muddied legal incentive planning waters, industry attorney Joshua L. Grimes, Grimes Law Offices, shared some tips in a recent SITE Global webinar.

Be very descriptive in your RFPs. Don’t limit yourself to what the online RFPs ask for, said Grimes. Include a description of the event — is it a reward for service? For networking? For teambuilding? — and the goals for the incentive trip. Whatever your concerns, also talk about those up front so the venues will understand your needs, he said.

For example, one concern might be that other groups you would prefer not to share space with may be at the same venue over your dates, something Grimes said is increasingly an issue, even for cruise incentives. “It’s helpful to be able to say you shared your concerns with the venues and suppliers up front” should anything happen later, he said.

He also recommends keeping your options open with more than one property until the contract is signed. “I would not let the one you’re negotiating with know that they’re the only one you’re talking to, because then you really don’t have a lot of bargaining power.”

Ensure your room rates are competitive. Sounds elementary, but this can take more than just negotiating hard to get the room rates you want, he said. Have a “most favored nation” clause, which says that the resort agrees not to offer the same rate to another group of similar or lesser size around the time of your gathering unless they also offer it to your group. Another approach is to agree that the resort or hotel will give you a certain percentage off the rack rate at the time of your meeting. “The point is that the rate they’re offering you should be competitive at the time of the meeting, particularly if you’re signing the contract a year or two in advance,” said Grimes.

Know what the room rate includes — and what it doesn’t. This once-easy question now is getting harder to pin down, he said. For example, does the room rate include daily housekeeping? What about early check-in? Will it cost extra to use the pool, internet, porterage, the health club? Are there mandatory gratuities? Is there an “employee well-being” fee? “It’s important to know, because these fees add up, and they can impact your bottom line,” he said. Some may think that the U.S. government has eliminated resort fees through recent legislation, but that’s not actually what happened. “What they said is that resort fees have to be disclosed prominently before you get to the final rates,” said Grimes. “It’s important to say how much the resort fee will be, and what it includes, in the contract.” And if the resort fee covers mainly things your group won’t be using, ask for substitute benefits or a lower resort fee. Not all properties will be responsive to that, but some may be, he said.

Then get all the fees listed in the contract, and add that the venue can not charge any additional mandatory fees unless either the group or the individual attendee agree to it in writing.

Hammer out potential payment snags ahead of time. If your U.S group is taking an incentive trip outside the U.S., how will you get your money back should the resort close down? Think in advance how you would recover your deposits if the hotel goes bankrupt, ceases operations or otherwise fails to perform. It happened to many groups as recently as during COVID, when resorts were closed but still refused to refund group deposits, he said.

One way to manage this risk is to push deposits as late as possible in the event cycle so if something happens, you won’t be out quite as much of the total. It’s also a good idea to pay by credit card so you can request a charge back to the credit card. “It’s not failsafe, but it makes it easier,” he said. Another option is to negotiate with a third party to hold the funds in escrow until just before the event. While this can be a little challenging to negotiate, properties may do it for you if your group is highly valuable to the venue.