Thousands of furloughed employees of MGM Resorts International could be losing their jobs, and for many the losses could be permanent.
This was the substance of a notice the company recently sent to an unspecified number of workers, according to a report in the Las Vegas Review-Journal.
The notice, which is required under federal employment law, also announced the extension of employee health benefits through August 31. However, at that point, MGM said, it will begin cutting jobs.
The company employs around 70,000 at its two dozen resorts in eight states. Nearly 63,000 have been on furlough since the Covid-19 pandemic began ravaging the U.S. in earnest in March.
Nevada’s casinos are expected to reopen in phases around Memorial Day, but with domestic tourism likely to remain stunted for no one knows how long, the expectation is the Las Vegas Strip, and the core of MGM’s portfolio along with it, will be mired in a prolonged downturn.
“When our industry bounces back, we will welcome you with open arms,” acting CEO Bill Hornbuckle said in the notice. “However, we understand you may find permanent employment elsewhere. We encourage you to do whatever is best for you and your families during this challenging time.”
The industry’s largest Nevada union lashed out at the plan.
“MGM can afford to be a socially responsible corporate leader in this unprecedented crisis instead of following the commands of its Wall Street masters who only see numbers and are blind to the people who have made this company successful,” said Geoconda Arguello-Kline, secretary-treasurer of Culinary Workers Local 226 in Las Vegas.
Meanwhile, more than 5,000 employees have applied for assistance with basic living expenses from an MGM emergency fund. Through the end of March, about 1,300 requests have been completed and around $1.8 million paid out, the company said.
Hornbuckle has said the company is working on a reopening and safety plan that will include guidelines on personal protective equipment, social distancing, sanitizing and crowd management. The plan is expected to published over the next week or so.
MGM has been spending around $270 million a month during the nationwide casino shutdown that was instituted in mid-March. The company recently raised $750 million in new debt and has some $4.6 billion in cash on hand and access to an additional $1.4 billion from its operating partnership units with real estate investment trust MGM Growth Properties.
Las Vegas locals giant Station Casinos also said it plans to lay off a sizable portion of its workforce. Station informed employees of the anticipated cuts, though the letter didn’t specify how many would be affected.
CDC Gaming Reports cited a company statement indicating 39 percent of a total workforce of some 14,000 could be out of work.
“Please know these are not decisions that we took lightly,” said CEO Frank Fertitta III. “This has been the most challenging and painful situation in our company’s history. We are hopeful, though, that Las Vegas will rebound swiftly and allow us to rehire many of our valued team members when we emerge on the other side of this crisis.”
Employees who are not laid off will continue to receive regular pay and benefits through at least May 31, the company said. Medical, dental, and vision benefits will be extended until September 30.
In line with plans released by Governor Steve Sisolak for a gradual reopening of non-essential businesses in Nevada, Station said it will resume operations in phases at most of its Southern Nevada properties when allowed.
The company operates 19 large and small casinos in the region and a tribally owned gaming resort in Northern California, all currently closed in response to the Covid-19 pandemic.
Meanwhile, as casinos nationwide look forward to opening their doors again and resuming business, workers want conditions: more protective equipment, social distancing policies and tough cleaning regimens.
Union leaders and workers from casinos in Las Vegas, Atlantic City, New Orleans and Biloxi gathered for a video news conference May 5 to insist employees be tested at the casinos’ expense before returning to their jobs, according to the Associated Press.
The largest unions, UNITE Here and the Culinary Workers Union, also unveiled health and safety protocols unique to each job.
“I’m scared to touch dirty beds and towels and catch the virus and get my children sick,” said Gladis Blanco, a guest room attendant at the Bellagio in Las Vegas.
Based on a handful of reopening plans, there appears to be agreement on some of the workers concerns. Companies including Wynn Resorts, Hard Rock and Las Vegas Sands have all endorsed providing masks and gloves, and embraced social distancing.
But the union’s requests also ask for major new commitments of time and resources to implement them. Donald “D” Taylor, Unite Here’s national president, said workers have to be given ample time to do the higher level of cleaning guests will expect.
The American Gaming Association said specific plans will vary among casinos, but “our commitment to the well-being of our team members and guests is consistent all across the country.”
The economy of South Jersey depends on tourism, and that’s going to be one of the hardest to recover, said New Jersey Senate President Steve Sweeney, a sponsor of legislation to help casinos recover. “We have to find ways to get these casinos open safely and get people back to work.”
Jeff Payne, a lounge server at Caesars Atlantic City, said the most important thing is that casino management and workers realize they are in this together.
“The casino industry, built on rewards and tiers, must understand that we are all equal,” Payne said. “Covid virus doesn’t care how much you gamble or what tier you are.”
