Columnist Jeff German: Atlantic City labor strife starting to hit the Strip

Wednesday, Oct. 6, 2004 | 10:57 a.m.

The once-cordial relationship between the Culinary Union and Harrah's Entertainment and Caesars Entertainment, two of gambling's biggest names, is rapidly deteriorating under the weight of a strike on the Atlantic City Boardwalk.

It's disturbing news for the casino industry in Las Vegas, where both companies, which are planning a merger, are major Strip players and have enjoyed labor peace with the union for 20 years.

Company and union officials accused each other Tuesday of mounting a power play at the expense of the workers in Atlantic City to gain leverage when contracts at Las Vegas casinos expire in 2007.

"They want to basically close down the casino industry three years from now if the industry doesn't meet their demands," Harrah's spokesman Gary Thompson said. "We think it's unfortunate, in their zeal for additional power, that they're ignoring the needs of their members."

But John Wilhelm, president of the hospitality division of UNITE HERE, the recently merged union of culinary, textile and laundry workers, charged that management is on a "shortsighted" grab for power.

"I think it's very troublesome that a company that will be a giant in Nevada and nationally is on this warlike path," said Wilhelm, the union's chief negotiator in Atlantic City. "I thought they placed a greater degree of value on the labor-management partnership we've had."

Harrah's and Caesars have, for the most part, agreed to the union's demand for wage increases and continued free health benefits. But the companies are insisting on five-year rather than three-year agreements sought by the union.

The union wants the contracts to expire at the same time as Las Vegas agreements so that it will have the necessary leverage to stand toe-to-toe here in three years with what is expected to be a stronger merged Harrah's and Caesars.

Company officials, however, are scared to death of the power the union would have if the contracts are up in the same year. If talks go sour in 2007, it could lead to simultaneous strikes in Las Vegas and Atlantic City.

So both sides are digging in for the long haul and stepping up the rhetoric in a five-day-old fight that is getting nastier by the day.

Fallout officially should reach Las Vegas next week, when Local 226 of UNITE HERE stages a massive demonstration in support of its striking colleagues in Local 54 in Atlantic City.

But if you listen to union leaders, the conflict already has spread to the Strip.

"We are definitely going to make sure that Harrah's and Caesars are not able to screw our workers in Atlantic City and have wonderful relations with our workers in Las Vegas," Local 226 Secretary-Treasurer D. Taylor said. "That part of the equation is gone."

This is a huge gamble for the union, which has never before taken an adversarial role with management in Las Vegas three years in advance of a contract deadline.

"At the end of this, the union is either going to be substantially stronger or substantially weaker," said one ranking Strip executive with no dog in this fight.

"I hope (the union) has a better contingency plan than George Bush had in Iraq."