Possible Las Vegas casino workers strike looms as contracts set to expire

Possible Las Vegas casino workers strike looms as contracts set to expire

- in Business
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Union spokesperson Bethany Khan said earlier Thursday that talks had been ongoing with Caesars Entertainment regarding a new contract, but no more meetings with MGM had been scheduled.

The two companies that control 18 of the 34 properties that could be affected said Thursday they were optimistic that deals could be reached, but did not say when.

MGM Resorts International said in a statement Thursday that “We are confident that we can resolve the outstanding contract issues and come to an agreement that works for all sides.”

Caesars Entertainment issued a similar statement saying that it “continues to meet with the Culinary Union to finalize a new 5-year contract,” and “we are confident that we will achieve a tentative agreement without a work stoppage.”

The union has failed to come to terms with management over a new contract, citing grievances like wages, training, sexual harassment by guests, and the fear of various positions being replaced by robots or automation.

They’ve asked MGM and Caesars for annual raises of about 4 percent for the next five years while the casinos have countered with 2.7 to 2.8 percent, documents released by the union say.

Around 24,000 workers are affected under the MGM contract and 12,000 are under the Caesars contract, the union said.

Downtown casino and resort properties could be affected as well. The union says the expiring contracts affect workers at the Golden Nugget, the D, Binion’s and El Cortez, among others.

Khan said that the union would be opening a “strike HQ” on Friday morning, where members would be making picket signs and taking other preparations for a possible strike, she said.

Image:
Volunteer Jenifer Murias yells into a megaphone as Culinary Union members file into a university arena to vote on whether to authorize a strike on May 22 in Las Vegas.Isaac Brekken / AP file

Still, some Wall Street analysts said this week that they believe a strike is unlikely.

Deutsche Bank Markets Research referenced in an industry update Wednesday the union’s June 2013 contract as a precedent. Under this contract negotiations with Strip operators went on for several months, without disruption to business, before ultimately culminating with a new deal in November of that same year, the note said.

The bank added that media and press releases from that period “struck a similar tone to what we are seeing today.”

The last time there was a city-wide strike involving casino workers was in 1984. That strike spanned 67 days. During that time, union members lost an estimated $75 million in wages and benefits, while the city lost a similar amount in tourism revenue, the Associated Press reported. Millions more were lost in gambling income.

The Culinary Union released an analysis from UNITE HERE Gaming Research on Wednesday that estimated a one-month strike could cost MGM Resorts International and Caesars Entertainment Corporation over $300 million in operating profits.

Related

Gambling is big business in Las Vegas. Around 42 million people are estimated to have visited the city in 2017, according to the Las Vegas Convention and Visitors Authority. The authority says spending sourced to those 42 million visitors was estimated at $34.8 billion that same year.

In Clark County, where Las Vegas is located, gaming revenue was around $9.5 billion in fiscal year 2017, with more than $6 billion of that coming from the Las Vegas Strip, according to a Nevada Gaming Control Board report released in January (those numbers are before expenses are taken into account).

Image: Las Vegas Union Strike
Miguel Martinez, a member of the Culinary Workers Union, Local 226, chants in front of a university arena before a evening vote on whether to authorize a strike, in Las Vegas on May 22, 2018.Steve Marcus / Las Vegas Sun via AP

And the Las Vegas Golden Knights hockey team, which are in the Stanley Cup playoffs in their first year, have home games scheduled in Las Vegas against the Washington Capitals beginning June 7, adding to the potential loss in tourist and casino revenue.

The union has called on visitors to not patronize hotels and casinos if a strike is called, and are urging people not to cross picket lines if there is a labor action.

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