Atlantic City casino workers vote overwhelmingly to authorize strike

Friday, Sept. 10, 2004 | 10:54 a.m.

SUN STAFF AND WIRE

Casino workers in Atlantic City voted overwhelmingly Thursday to authorize their union to strike if a new contract is not reached by Wednesday.

If called, a strike would affect all but one of the city's 12 casinos, the Borgata Hotel Casino & Spa, which opened last year. Its contract with Local 54 of UNITE HERE does not expire until 2007.

D. Taylor, secretary-treasurer of the Culinary Union, the UNITE HERE affiliate in Las Vegas, has been in Atlantic City the past week helping out with the negotiations. Taylor said the union in Atlantic City is "far apart" on four major issues that bear equal weight.

The union is seeking to maintain free health care coverage for workers that the casinos are attempting to revoke by having workers begin to make contributions to their health plans, Taylor said. Second, the union is concerned about the casinos' use of non-union employees through subcontractors. The union also is pressing for successorship clauses that would require companies to maintain union contracts at properties that are bought and sold in mergers and acquisitions. Finally, the union wants a three-year contract instead of the current five-year contract so the new contract would expire with that of the Borgata as well as with casinos in Las Vegas and Detroit.

"Atlantic City is about to explode and we want to make sure we are part of that growth," Taylor said, referring to expansions completed or underway at several properties.

Harrah's Entertainment Inc.'s recent deal to buy out Caesars Entertainment Inc. as well as other recent merger activity led to the desire for a three-year contract in line with Las Vegas and for the successorship clauses, Taylor said. But other issues are specific to Atlantic City, he said.

Some 14,500 of Local 54's 17,000 members were eligible to vote, union spokesman Chris Magoulas said. The union represents cooks, housekeepers, food servers, bartenders, cocktail servers and other service workers.

He said 8,020 members voted to authorize a strike and 108 voted against.

He said traffic was so heavy around the convention center where voting took place that thousands of union members were not able to cast their votes.

The last citywide strike by Local 54 was in 1999, a three-day action that crippled casino hospitality services.

Negotiators took a break Thursday after talking on Tuesday and Wednesday, Magoulas said.

Joe Cole, a spokesman for Tropicana parent Aztar Corp., declined comment and referred calls to representatives at the Atlantic City property, who could not be reached by press time.

Spokesmen for Caesars and Harrah's said their companies were hopeful they could reach an agreement with the union before the strike deadline.

Union representatives said they were prepared to strike.

Joann Orr, a cocktail server at Caesars Atlantic City and a union negotiator, accuses her employer of cutting costs at workers' expense and says industry consolidation is partly to blame.

"They're not making less money, they're making more and they're cutting every way they can," said Orr, who has worked at the property for 24 years.

"We're dealing with globalized corporations and the dream of corporate America is to have part-time employees with no benefits," she said. "They don't want to share the wealth with their employees."

Caesars spokesman Robert Stewart said Atlantic City has become an increasingly competitive market where growth has slowed because of new competition from the Borgata and skyrocketing health care costs.

"All you have to do is look at the debut of the Borgata in July and look at the revenue figures. There's not dispute that companies that want to be successful have to watch their expense side," Stewart said. "What we're about in New Jersey is preserving jobs and keeping our casinos healthy and profitable in the face of increased competition."

If a strike is called, the negotiating committee could target one, some or all of the casinos, Magoulas said.

Of particular concern is Tropicana Casino and Resort, which plans to subcontract jobs at The Quarter to companies that can hire nonunion workers, said Al Tabei, a member of Local 54's executive board and negotiating committee. The Quarter is a Havana-theme shopping and entertainment complex opening this fall.

The committee urged a "yes" vote on strike authorization, he said. He declined to say whether members would strike if no contract was near by Wednesday.

"We want to avoid that if we can," said Tabei, 52, of Cherry Hill, a bartender at Bally's Park Place Casino Hotel for the past 14 years. But union members are prepared to walk without a fair deal, he said.

In a research note today, Morgan Stanley analyst W. Todd Scott said a settlement is likely before the contract expiration date because "casinos will try to avoid the bad press associated with a strike," especially in the face of growing competition from newly legalized slot machines in Pennsylvania.

Still, Scott said a strike would minimally affect operators' bottom lines. The three-day walkout in 1999 didn't shut down most casino, hotel and restaurant operations, he said. While restaurants, spas and other amenities could be closed or have shorter hours, casinos and hotel areas would likely stay open through a strike, he said.

The casinos have split into three different bargaining groups, according to the union:

Not participating is the Sands Casino Hotel, which has an agreement allowing it to join in the first approved contract, and the Borgata.

Sun writer Liz Benston contributed to this report.