Union, MGM Mirage take dispute outside

Michael J. Mishak

Friday, June 29, 2007 | 7:19 a.m.

Contract talks between the Culinary Union and MGM Mirage have entered a new phase, one step removed from the issues that separate them at the bargaining table.

With negotiators dug in over economic issues and organizing rights, the company and the union are trying to apply pressure outside the bargaining room.

On Wednesday MGM Mirage released a two-page memo, originally drafted for company management, apparently intended to step around union leadership and speak directly to union members.

On the other side, labor leaders are scheduling negotiations with other casino companies, in hope of isolating MGM Mirage on the Strip.

Current five-year contracts, affecting about 50,000 hotel and restaurant service employees, expired June 1, but the union and the casino operators signed extensions that allow both sides to continue negotiating. About 21,000 of those workers are employed by MGM Mirage.

The Culinary scored its first major victory this month when it reached a settlement with Harrah's Entertainment, the second largest operator in Las Vegas with about 15,000 Culinary employees at six properties. Culinary Secretary-Treasurer D. Taylor hailed the deal as historic, saying it included the largest - ever wage and benefits package.

Under the new contract, pay raises come in the form of fixed hourly increases spread out over the course of the agreement. The deal also continues to give Culinary an easy "card check" method of organizing workplaces, including those managed by third-party operators.

Both issues are sticking points in the MGM Mirage talks, and the company used its memo to offer a competing narrative to the one provided by union leadership.

"While the union continues to assert there are many unresolved issues, the simple truth is that our progress has been very significant," said Cynthia Kiser Murphey, vice president of human resources for MGM Mirage, in the memo. "At our last count more than 80 Tentative Agreements had been reached. Clearly, this progress is something that is, regrettably, not reflected in the union's public statements."

Taylor said the memo misrepresented the contract talks, saying the union's largest items remain unresolved. He added that the items that had been agreed upon were standard language issues, and expressed resentment over the company's decision to release internal documents.

"I find it strange that an e-mail to executives goes out to the press," Taylor said. "I'm mystified. It has nothing to do with reality.

"I don't know what negotiations their team was in. Our team must have been at a different negotiation session," Taylor added.

MGM Mirage stood by its assessment, saying that both sides had reached tentative deals on employee training, a development career ladder and military leave policy, among other items.

"We see that as significant progress," spokesman Gordon Absher said. "That's not to say there are not outstanding issues and issues of substance, and we look forward to talking about those."

In its memo, the company focuses on the economic proposal, labeling it as the largest remaining issue. Murphey, the human resources director, seizes on what she refers to as the union's continued refusal to explain the reasons behind its rejection of the company's economic proposal.

MGM Mirage wants a deal based on the one signed two years ago with Steve Wynn at Wynn Las Vegas. That contract, a 10-year pact, links pay raises to the consumer price index.

The union wants either flat increases, as in the Harrah's deal, or raises linked to the company's growth.

"Among our MGM Mirage negotiating team we have literally decades of experience in negotiating collective bargaining agreements," Murphey wrote. "None of us have experienced anything like this."

Taylor said the union's negotiating committee, composed of hundreds of workers, wants a Harrah's-type deal, largely because of the predictability of fixed annual raises.

James Gross, a professor of labor policy and labor arbitration at Cornell University's School of Industrial and Labor Relations, said the MGM Mirage memo has the tinge of making an end run around union negotiators.

Still, it's one step removed from a similar, tougher tactic employed most notably by General Electric a few years ago, he said. In that case, the company appealed directly to employees, first by polling them about benefits and then offering a "firm and final" offer at the bargaining table.

Regardless, Gross said bargaining in public is a desperate move that's not good for either side in the long run. The short-term gains, he said, are not worth the long-term effect.

"You have to deal with the union in the future, even if your end run works," Gross said. "If the union has to cave because of the pressure, there will be grievances later. There's an ongoing relationship based on mutual trust and respect, and to the extent that one side undercuts the other it could boomerang to hurt good faith."