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Monday, Aug. 3, 2009 | 2 a.m.
Richard McCracken, strategist for the Culinary, says a company in bankruptcy reorganization must get court approval to spend money to counter a union organizing drive.
Sun Coverage
Sun Archives
- Lenders battling in Station Casinos bankruptcy case (7-30-2009)
- Station Casinos wants out of lease for office space (7-29-2009)
- Station Casinos files for Chapter 11 (7-28-2009)
- Bondholder drops lawsuit against Station Casinos (5-11-2009)
- Station Casinos: Bankruptcy date depends on bondholders (3-18-2009)
- Betting it all on bankruptcy? (2-17-2009)
- Hearing delayed again on Station Casinos site (2-16-2009)
- Boyd responds to Station’s rejection of buyout (3-9-2009)
- Station rejects Boyd’s offer, extends debt deadline (3-3-2009)
- Boyd makes play for Station Properties (2-24-2009)
- Boyd Gaming offers to buy Station (2-23-2009)
- Station responds to lawsuit, misses $15.5M payment (2-17-2009)
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The Culinary Union fought for years to organize the Aladdin. But it wasn’t until the resort filed for bankruptcy protection that the union gained the upper hand.
That lesson was on the minds of Culinary leaders last week as Station Casinos — the union’s bitter rival — filed for Chapter 11 protection, providing perhaps the most significant opening yet for organizing the nonunion casino giant.
In an interview, Richard McCracken, the Culinary’s lawyer and strategist, said the bankruptcy filing was welcome news because expenditures become subject to court approval, so management can’t respond quickly to a union campaign.
“Companies have to go to court to make an application to hire union busters,” McCracken said. “And it becomes a question of whether creditors want to see resources spent like that.”
In the case of the Aladdin, McCracken said, management ultimately hired a consultant to fight the union, but “not with the kind of intensity and ferocity a well-heeled company would bring to bear.”
The Aladdin opened nonunion in 2000. The owners denied the union’s request for a card check, a system wherein an employer recognizes a union after a majority of employees sign cards. The operator insisted on a secret-ballot election.
Within a year, the Aladdin, saddled with debt and reeling in the wake of 9/11, filed for bankruptcy protection.
The Culinary’s work then began in earnest. It staged protests, stepped up organizing efforts and filed complaints of unfair labor practices.
The company fought back, but, McCracken said, “there’s a big bill that comes with running a full anti-union campaign. And companies in bankruptcy proceedings are less able to mount that effort.”
Planet Hollywood took control of the resort in 2004, and in months agreed to a card check, which the union won handily. “Things change hands, and oftentimes we find the new hands are nicer hands than the ones before,” McCracken said.
But the new operator didn’t recognize the Culinary out of kindness. When Planet Hollywood emerged as the Aladdin’s new owner, the union kept up the pressure. The Culinary sent letters to the Nevada Gaming Control Board questioning the fitness of the new owners.
Planet Hollywood ultimately won licensure, and after the union cards were counted, Aladdin executive Michael Mecca offered this: “We got to know the people who work here and understand our business. We listened to what the people of the Aladdin wanted.”
Rick Hurd, a Cornell University professor, said the Culinary and its parent organization have perfected campaigns against hostile employers. “The hotel employees, historically, have been masters of finding whatever leverage they can, whether it be government regulation or a bankruptcy judge,” he said.
But the union’s tactics have failed at Station.
The feud goes back to 1993, when, thinking it had majority support and the owner’s cooperation, the Culinary ran a conventional organizing campaign at the Santa Fe and won an election to represent the resort’s workers. The owners disputed the result and dragged out the appeals and bargaining process until 1999, when the property was sold to Station, which dismissed the workers in a wholesale firing. Culinary’s challenges to the move failed.
The union purchased Station stock and protested at shareholder meetings, objecting, for instance, to an executive compensation plan. But such avenues were cut off in 2007, when Station went private in a $5.4 billion buyout.
Now, experts say, the union has a new edge as lenders fight to protect their stake in Station’s $6.4 billion debt.
“The union has a lot of cards,” said Harley Shaiken, a University of California, Berkeley, labor expert. “Anything that promises disruption to a company’s image, the lenders are going to take quite seriously. It could make lenders skittish, particularly if the company is asking for funding.”
David Rosenfeld, a law professor at UC Berkeley, said the Culinary could engage banks directly to get Station to recognize the union.
Still, Shaiken said, the success of any organizing drive is determined by rank-and-file support.
the union bashers will be out on this article, always blame the little guy. scum at the top has ruined some great facilities. they forgot they aren't strip properties.
In 1914 Henry Ford offered his employees more than double the prevailing wage and instead of sky high turnover he got the most loyal people in the world to work for him, and it paid off for Henry, his workers and The United States of America. If we are going to get out of this mess Labor and management had better try some teamwork here or we are headed for trouble!
Hey all. Today (August 3) on "Face to Face with Jon Ralston", we're talking with a couple of gaming experts about the Station Casinos bankruptcy and much more. That's at 5:30pm, 6:30pm, 8pm on Las Vegas ONE, Cox Cable Channel 19.
The union strategy is brilliant!
I have always wanted to go into my neighbors house and take that really cool stuff he bought. The problem is that he has a big dog 'guarding' the house. That darn dog tried to bite me when I was climbing over the wall, so I forgot all about getting that stuff.
My neighbor was in a bad motorcycle accident, he should recover, but he's going to be in the hospital a long time. They had to kennel his dog.
Thanks to the GREAT idea from union practices, I can now go back to my neighbors house and get that stuff while he is in the hospital recovering!! Thanks UNION!
When people bash unions, I suggest they live in a state which has no unions. Wages and working conditions for the middle class are low and much worse. Unions tend to use bully tactics, but they raise the tide around them for even non-union workers.
In the 1970's, 43% of workers were union. Today it is 7%. The middle class was much better off then.
Please...can we be more honest when quoting "facts". 7.6% was the private sector unionization rate, totally leaving out the public section which represents a large percentage of employment. From the BLS:
UNION MEMBERS IN 2008
In 2008, union members accounted for 12.4 percent of employed wage
and salary workers, up from 12.1 percent a year earlier, the U.S.
Department of Labor's Bureau of Labor Statistics reported today. The
number of workers belonging to a union rose by 428,000 to 16.1 million.
In 1983, the first year for which comparable union data are available,
the union membership rate was 20.1 percent, and there were 17.7 million
union workers.
Unions are absolutely needed. Believe me if it were not for the union you would have 50,000 culinary and housekeeping employees on the strip making poverty wages and very little health care. The union has protected that and you cannot convince me otherwise. There are some negatives with the union but for the most part they do protect the little guy.
There is no disputing unions, great for workers, bad for owners. I don't know that I would be pumped to form a union of a company that could chopped and sold within the next couple years. I hope it works out for the workers, I had a friend that started at Aliante when it opened, and he eventually got laid off, he started collecting unemployment and they called him two weeks later and offered him an "on call" dishwashing job with no guaranteed hours. He said he could not accept a job that didn't pay anything (duh), and station casinos stopped his unemployment because he turned down a job offer. Pretty F'n shady! So I know if they do this to one worker they will do it to others, so I hope they can unionize.
told you the union bashers would be out. selfish people who don't care about anyone else but themselves, probably rightwing christian nuts also.
Oh gawd....here comes the snakes! Unions, why don't we all just slit our throats and get it over with.
How about a binding agreement whereby the employees decide by secret ballot if they want Culinary to represent them? With guarantees by the compnay that no action will be taken before or after the vote against employees who openly support the union, as well as a guarantee by the union that they'll abide by the vote (for at least 24 months, then they can try again)? Anything more confrontational will just hurt business & employment -- except for lawyers of course.
If I go into a casino that is unionized I do not tip anyone. I use the cullanary union's web page to determine who is unionized. I usually leave a note that I appreciate the good service but I don't support union members. I have been called some ugly names by waiters two of whom were fired by the restaurants. Tough.
You must be a Republican.
Wow! I didn't know you could fire a union worker. You learn something everyday.
101, hope casinos have a picture of you. what a jerk. if you know a place is unionized , why the hell go there in the 1st place if you don't care for them. please let the rest of us know where you work so we can avoid the place. rich people are laughing their asses off knowing their pitting middle class against each other. story after story of ceo's and others making ridiculous money during downturn, yet some boozo's will defend them to the end. sad.
the union is so great Michigan has about 20% unemployment. I see Vegas heading down the same path.
Culinary needs to clean its own closet before they take on new ones. Culinary is so dues hungry right now, since thousands of members have been layed off, that they will try anything to earn more income, at the expense of dues paying members right now. Culinary needs new and more intellectual leaders immediately. Members rights are being stepped on as we speak.
Is the union a business entity and if so is it privately owned or is it publicly traded? Do union's open businesses of their own to operate?
Unionization simply raises the cost of doing business, which means less investment and/or higher prices. Profits just dont sit in the casinos, they are used for growth and construction by and large.
So, lets double the wages with a union, and let stations just go into chapter 7 and be gone. Then lets see where the jobs are.
Best wishes to Richard McCracken, as Culinary's lawyer. However, he obviously knows very little about how big bankruptcy cases are run. He obviously hasn't read Station Casinos, Inc.'s cash management motion approved by the bankruptcy judge.
The way the bankruptcy is set up, none of the subsidiaries which own the casinos, and none of the companies actually operating the casinos, are debtors in bankruptcy. Under bankruptcy law, these casino operating/cash generating corporations can keep their income and expense details a complete secret from the bankruptcy judge, and from the creditors. There is absolutely no requirement that these casino operators/cash generators who are not debtors in bankruptcy get the bankruptcy court judge's approval of ANY expenditure.
In fact, Station Casinos, Inc.'s motion filed with the Bankruptcy Court, on the first day of the bankruptcy case, included a "cash management motion" which spelled out, in great detail that the money from the bankrupt and not-bankrupt entities would be kept completely separate. The order approving that motion was drafted by Station Casinos, Inc.'s bankruptcy lawyers and signed by the judge.
So, Culinary is wrong if they think that they can prevent the non-debtor subsidiaries of Station from spending money on union busters. Culinary and the rest of the public won't even see it happening.
The problem of not-bankrupt subsidiaries of big, bad bankrupt companies, running amok, and doing nasty things is not at all uncommon. The Lehman Brothers bankruptcy is a perfect example. All sorts of stuff upsetting to Lehman's creditors is going on in the not-bankrupt subsidiaries which have millions of dollars of income each month. Just like the non-bankrupt subsidiaries of Station will.
Sophisticated bankruptcy lawyers for corporate debtors set up bankruptcy cases in this way so that the debtors' key "ugly stuff" can continue to be funded without any court or public scrutiny.
The same thing just happened in a huge real estate bankruptcy case in Delaware run by Lehman Brothers' bankruptcy lawyers.
Station Casinos, Inc.'s lead bankruptcy lawyer has an eye popping resume, in terms of tons of complicated, nasty bankruptcy cases he's been involved in. Bankruptcy lawyers learn "dirty tricks" to play on their clients' enemies, in and out of bankruptcy court, by watching other bankruptcy lawyers do it to them and to others.
As a result, with no unkindness to Richard McCracken intended, be prepared to be hosed. You are not a bankruptcy lawyer, and there is no way to achieve your client's goals based on a belief that Station Casinos will not have the money to fight your clients. I won't say "Give up", but make sure your clients understand that they will, by and large, be wasting money on attorneys fees if they try to fight the not-bankrupt station subsidiaries from using their money to union bust.
I agree with the other lawyer above. The bottom line, though, is that Station Casinos' subsidiaries, which this article says are not unionized, are obviously doing something right by their employees if they have stayed non-union for this long in an otherwise union town. So-called "union busters" can't prevent employees from organizing (voting for a union or even signing cards) if the employees do not feel fairly and appropriately treated by their companies. Anyone who follows these things knows that and I suspect Mr. McCracken knows it, too -- even if they don't admit it to anyone publicly. The "union busters" worth their fees tell companies how to prosper (or at least survive) in a competitive marketplace without their employees being treated so bad they feel they need unions to get them treated fairly.
There is an assumption in some of these comments that employees just get swayed by fast-talking "union busters" - that sort of assumption is insulting to your average worker who knows whether they are treated appropriately and fairly and is able to decide for themselves whether a union gets them better treatment.