Columnist Jeff German: Will what happens in Atlantic City stay there?

Wednesday, Sept. 22, 2004 | 11:05 a.m.

If you believe the stepped-up rhetoric from the Culinary Union, the prospect for labor peace on the Atlantic City Boardwalk is slipping away faster than you can lay down a bet at a craps table.

Why should you care?

Because what happens in Atlantic City could have far-reaching ramifications for the industry in Las Vegas.

The union is now threatening to go on strike Oct. 1 if new contract agreements can't be reached with 11 casinos, five of which are owned by Las Vegas gaming giants Harrah's Entertainment and Caesars Entertainment. A total of 14,500 workers could walk out.

"We anticipate a very long and difficult struggle back there," says local Culinary Secretary-Treasurer D. Taylor, who doubles as an international vice president. "Clearly the companies don't put a lot of value on the partnership we have with them."

Much of the tough talk is posturing on Taylor's part to get some movement out of management. We heard similar threats from Culinary Union leaders two years ago when contract talks stalled with some three-dozen Las Vegas casinos. The union set a strike deadline then, too, but both sides reached an agreement a few days before a planned walkout.

This time, however, there's a greater sense of urgency in the voices of union leaders, who are looking ahead to the day when they will have to deal with an industry that has consolidated its power. Harrah's and Caesars have announced plans to merge into one gaming conglomerate. So have MGM MIRAGE and Mandalay Resort Group, which aren't involved in the contentious Atlantic City negotiations.

There is a sense of urgency on the other side of the bargaining table, too. Profit-minded casino executives are concerned that, if they give the union what it wants in Atlantic City, it could undermine their bargaining position in contract talks on the Strip three years from now. This is the union that is starting to flex its muscles after recently doubling its membership and falling into some wealth with a merger of its own.

What the union wants in Atlantic City is to negotiate a three-year, rather than a five-year, contract, so that the new collective bargaining agreement will expire in 2007, at the same time as the casino contracts in Las Vegas and Detroit. That will give the union the leverage it believes it needs to stand up to the vast resources of the consolidated casino corporations in three years.

"Dealing with companies that are worth $8 billion one city at a time is like putting a pea shooter up against a Sherman Tank," Taylor says. "That's not a partnership. That's total domination."

It's also heaven to casino executives on the lookout for the bottom line. And it explains why Harrah's and Caesars, which were the first to cave in to the union two years ago in Las Vegas, now seem to be making a stand in Atlantic City. Letting the union have too much leverage, it turns out, is bad for business.

"A lot of people are uneasy about what's happening in Atlantic City," says one gaming executive watching the negotiations. "If the union gets its way, there's going to be a dark cloud over the Strip in the future."

There may be a dark cloud no matter which side gets its way.