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twitterDAILY MEMO: GAMING:
Wynn dealers persist in fight to topple tip-sharing policy
Monday, July 13, 2009 | 2 a.m.
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Nearly three years after Steve Wynn implemented a policy requiring that dealers share tips with their immediate supervisors, what he thought would be a short-lived skirmish has turned into an all-out war.
It’s the kind of battle dealers might not have fought in years past, when many lacked college degrees and other professional job options.
“They underestimated us,” said Daniel Baldonado, a bespectacled, quick-witted Wynn Las Vegas dealer and one of the four whose complaints were heard by the Nevada labor commissioner last week. “We left other jobs to come to Wynn. We’re smarter — and we’re not giving up.”
This, after a string of setbacks, including unsuccessful union contract negotiations, a dismissed class action lawsuit and thwarted attempts to clarify state law with a ballot initiative and legislation.
First on the witness stand was Wynn dealer Meghan Smith, an articulate young woman who lit out for Las Vegas after earning a business and international relations degree from Carnegie Mellon University and a master’s degree from the University of Oklahoma.
Both sides in this dispute have dug deep foxholes and mapped out lengthy strategies.
They plowed much of the same ground last week. Labor Commissioner Michael Tanchek will continue public hearings on the dispute Aug. 18-21 and make a final ruling as early as October.
The debate isn’t clear-cut, with effective or creative legal arguments to be made on both sides.
Though tips are considered taxable earnings, they are sometimes treated differently, with both camps using case law — different parts of the same rulings, in some cases — to bolster their case.
Generally, courts have determined that employers have the right to force employees to pool their tips — just as they have the right to establish wage rates and impose other policies and procedures. And yet, courts also say employers can’t directly benefit from employee tips or tip-pooling arrangements.
Wynn’s attorneys say Wynn isn’t taking the tips for his or his company’s benefit, and is instead requiring different groups of employees to share them. They argue this makes the policy legal under Nevada law, which states: “It is unlawful for any person to ... take all or part of any tips or gratuities bestowed upon his employees.”
That’s creative wordplay to the dealers, who say the policy has saved the company millions in payroll costs, as tips that would otherwise would have gone to dealers are diverted to supplement the earnings of “casino service team leads” — a supervisory title created in conjunction with the 2006 tip policy.
Wynn admits that he could have paid the supervisors a much higher base salary but instead chose to give them tips as a motivational tool. (A team lead’s base salary of $65,000 is $6,300 higher than that of the now-defunct floor supervisor positions. Yet each team lead receives an estimated $25,000 per year in tips representing the supervisors’ share of tokes deposited at dealer tables.)
The losing side is expected to file an appeal in court that could further delay a resolution. Even if Tanchek declares Wynn’s tip policy illegal, Wynn could appeal that decision in court, maintaining the policy during litigation.
Wynn dealer Leo Gemma, who stood among a crowd in 107-degree heat to protest the tip policy outside the hearing room in the Grant Sawyer building last week, seemed both motivated and disheartened by the proceedings. “I think the labor commissioner has already made up his mind against the dealers and this is a waste of taxpayer money,” he said.
Gemma and two other dealers fired another shot across the bow Friday, filing a federal lawsuit claiming Wynn failed to pay dealers wages owed under the Fair Labor Standards Act and breathing new life into the battle.
“This fight isn’t over,” Gemma said. “People don’t realize this kind of thing could happen to them.”
Discussion: 46 comments so far…
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In our country, it works a bit differently. All tips are collected. The company has made contracts with all casino employees but not all have hte same basic salary. Now the company uses all tips in order to pay for the salaries, which, for our living standards, are "ok salaries" for everybody. But that's not all. In order to make it a bit more challenging, the company only withholds a certain percentage of these tips to use them for the payroll. A smaller percentage of that pool is being distributed among all employees in a percentage-wise manner. The people with higher salaries collect a higher portion of these tips. The ones at the bottom of the ladder, accordingly less. Everybody get's the same percentage of the tips, but because of the different individual contracts, the net amount being paid to the individual is not the same. People with higher basic salaries therefore have a higher portion of the tips although they don't directly work with the customer. The true front-liners are the dealers, but they only get a minor amount of what the pit bosses are collecting. Is that fair?
Well, there are so many different ways of seing things. I have tried to find a solution for this matter although I am not in the position to make decisions. The tips should be for the ones receiving them, but then, there would be a fight for the best "players" or "tables" to work for. I think craps tables are tough working at, but generate less tips than b-j. There must be found a way of sharing so that everybody is happy.
From Switzerland
I quit tipping when the dealers began pooling tips, long time ago.
you watch results, if steve wins, harrah's and mgm will follow trend in next year. just another rich person not giving a hoot about regular guy, yet we have numbskulls on these blogs that will defend these rich jerks to the hilt. they have divided americans against each other on STUPID issues while they rake in the dough.
Sounds like a good movie. Kind of an Erin Brakovitch in a casino! Fighting Steve Wynn is certainly like fighting City Hall. You can't win. But maybe they can find a creative way to make it appear they won. Sure. I believe that! Go dealers!
Tips should go to front-line employees, not supervisors. In a restaurant situation between servers and bussers, but the owner and manager do not get to share in tips. Whether it's illegal or not, it's unfair, and "guests" of the casino do not expect part of their tips to be given to supervisors.
No tipping period. Let the employer start paying a working salary. Since when does the the employer get a free ride on someones ability to generate good business. They both win that way. The employer runs a thriving business and the employee is rewarded justly.
Ace's
Steve Wynn should just pay all his employees a good wage and ban tips all together. He runs a casino that is doing well with very little debt. He should pony up and pay all dealers a salary of say $140,000 each a year. He should pay all servers in his restaurant say $150,000 a year. Since he claims to be a good boss he now has a chance to prove it. Step up and either quit stealing from your staff or pay them a fat salary. Steve Wynn the rich guy who steals from his employees.
LasVegas2009 - I think you're Sheldon Adelson.
Forcing dealers to share tips with supervisors is akin to a parent taking money from the kids piggy bank how in the world could you think that was an OK thing to do. Ever heard of a conscience!
"Steve Wynn should just pay all his employees a good wage and ban tips"
I agree. When dealers make as must as they do and not service is being provided why does Wynn and the Union require tipping.
When someone cooks me agood meal and deliver it to my table that is service.
When somebody is dealing cards and taking my money why would I tip
I think the dealers have a very very good chance to win this case. The re-pooling policy at The Wynn was originated to definitely benefit the employeer. It's blatant & it's obvious. I think the dealers will eventually win the case.
They will never succeed in banning all tipping. The intent of the person giving the tip is to that specific employee. Not to the whole casino.
I believe that employers should be entitled to set their policies as they see fit, and employees can decide if they want to work there or not.
Do the players ever tip the supervisors? I doubt that it happens often if ever. In that case, they should not be sharing in the tips. I don't care if you call them team leaders, cheerleaders, or whatever, they are supervisors and shouldn't been taking what belongs to the dealers. If Steve Wynn wants his supervisors to make more, he can write them a check!
I don't gamble much but when I do, I generally tip at the table games.
If I ever play table games again I think I am going to decline to tip. If I tip a hottie dealer, I want her to get my tip, not a pool of losers, or worse, a pool of losers and loser supervisors.
Another article said that tip pooling reduced the average dealer's earnings at Wynn from $100K to $80K a year. They should be happy to earn at either of those levels. For me to do it, I had to get a master's degree. They deal cards.
It's not like they are sharing them with upper management or executives, they are sharing them with all dealers and the pit bosses. Those people that watch the tables, bring over the new cards, answer every call for dropped card or mistake of players, bring the markers so the players can keep betting. They are the team leaders and are as much a part of the play as the dealers. They all work together to maximize play and tips. This is simply a union against the man type suit.
I agree with neiman on that. The supervisors on the floor play a big role in determining how efficient things run, how quickly things are resolved, and contribute to the overall experience in a big way. They should have a vested interest in customer satisfaction.
That being said, employers should set their own policies, and employees should decide if they want to work there or not.
Henderson-you're correct. But the issue in this case is did the Wynn Hotel originate & institute a policy of tip-pooling to benefit the employeer. The answer is clearly-yes. An employeer can't institute a policy of taking take tips from dealers & sharing those tips with supervisors to avoid having to pay the supervisors themselves. The Wynn hotel is not itself benefiting from the sharing of tips. What they are definitely benefiting from is the policy they themselves instituted of forcing the dealers to share tips with supervisors. It's a backhanded way for the Wynn to avoid having to pay supervisors out of their own pocket.
I understand that it's not "traditional" to do things this way. My only point is that just because nobody else does it, doesn't make it a bad policy. Maybe it would be more fair for the supervisors were pulled into the toke pull so that they also benefit from the ambiance that they help create and contribute to.
only neiman would bring union word in here, and of course his clone henderson not far behind. rich lover lackys, just bring us china you 2.
UNDERSTAND THIS: Certain occupations are tip-based. I.E. Waitresses, dealers, etc. Supervisors are salary-based. End of story.
"UNDERSTAND THIS: Certain occupations are tip-based. I.E. Waitresses, dealers, etc. Supervisors are salary-based. End of story."
As I read the law as it is stated in this article, the only thing proscribed by law is the employer taking tips for the employer's direct benefit. The law doesn't proscribe sharing tips with other employees, whether hourly or salary-based employees. Therefore this policy, while it is unconventional, appears to be legal.
Steves not taking the money, the supervisors are... Steve is just in this mess because he implemented the rule or allowed it since its in his "house"... These dealers (in a non-recession year) are still making 90k+... It could be argued that its greed but on the flip side of the coin, these dealers left other casinos/ jobs to start over at Wynn only to be cut from aprox 110k to 90k in one year like it or not... Many of the folks that may be reading this are not feeling sorry when someone is making that much money but when you leave a previous job and change your lifestyle (buy a house, car, etc.) when expected to make $__(blank)__ amount of money MORE a year then yeah, its going to hurt and I would be fighting right along side of the dealers... Its another "funny" situation that the dealer supervisors are not making as much but that (in my eyes) is a cost you have to pay in order to climb the corporate ladder. In other words, if you want to climb to say pit boss, casino shift mang, etc - then yes, you need to maybe become a supervisor earning less but in hopes for a manager position down the line then earning more then the dealers...
9superstar9,
Just because you put "end of story" after your comment, (which is untrue), doesn't make you right. Supervisors at most MGM/Mirage properties receive tips out of the slot tip pool. They began receiving a share of the tips a couple of years ago.
It is possible that you don't know everything.
At the end of the day does Wynn right-off the tips to balance his books for some the take.
Perhaps with the Money Wynn saves he can buy another face lift.
Steve Wynn isn't any different than John D Rockefeller, Jay Gould, or Cornelius Vanderbilt. But, he may be smarter than all of them.
80k, 90k, 100k or more a year? Most of us tip in a restaurant knowing that they are getting mimimum wage (18k/yr. if full time) from the house. Therefore when we tip they may be making 30-35 a year. Not sure how generous I'd be in tipping a person who already makes more than me. On the other hand, a no tipping policy wouldn't work. People are used to tipping, especially if they're winning. If I won big, I'd tip big.
I'm rooting for the dealers, a 10-1 underdog.
Really emotive subject tipping.
Must say i have always found the US system a bit bizzare. What other industry pays staff inversely proportional to their responsibility.To say that the customers tip the dealers for the service they recieve is a bit one sided. Most casinos spend a fortune getting customers into their doors both directly through marketing programs and indirectly by the level of investment made in the properties.
It is perhaps no wonder that the majority of Us casinos are run by people who have absolutely no gaming experience.
Where is the incentive for a good dealer to progress in their career if they have to wait till they become management to have the opportunity to earn the same salary as a dealer.
Most developed tipping environments in Europe have long since established a tipping system based on heirachy . To say that it is only the dealers that work for tips is ridiculous. The supervisor and Pit Bosses are key to the customer experience and are a legitamate part of the pit team and therefore should be part of any tip pool.
Anyone who has worked closely with tips will know full well that they are not generally given in relation to service but in relation to short term customer gains. The only ultimate advantage that some one like Steve Wynn gets financially is the gaming tax that he does not pay on the money in his tip box.The money or at least a large portion of it would end up in somebodies drop box or cash float.How many times have you seen a customer walk away skint having left his bankroll down the tip box. He also gets a structure that encourages progression within its ranks and any dealer with aspirations for career advancement would recognise it. Sure he could just pay extra to his supervisors and pit bosses but i suspect that the business model wont allow for it especially with dealers earning 100k plus and his only other option is the status quo.
I would advise any casino employee in todays market to be a bit more pragmatic and be thankful they have a well paid position and look for ways to better serve their customers, improve the bottom line and therefore protect what in reality is a very good job.
No i dont work for Wynn nor do i participate in tips just in case you were wondering
about 10 years ago I hit a royal for 4000 dollars, I gave the payer a 100 dollar tip, she said "most people give 10 per cent". Imagine that! That was the last tip I ever gave out. These people think we're all tourists. dumb and dumber. Most of the dealers could not run a customer out of a casino , much less bring new ones in. The buildings are the attraction not the dealers.
thats what we do in vegas
excellent post.
Here's a story roughly 9 years ago when Jaromir Jagr was playing blackjack at Paris Las Vegas and won over $50,000 at the table....The world renowned International Czech Hockey Star tipped the dealer a whole whopping. . . . $10.
So that would be what....maybe a whole .02 cent cut for each dealer and supervisor if it happened at the Wynn ?
What is a difference between a Norweigan and a canoe ?
[answer]: Sometimes the canoe will tip.
The issue is that without the tips the supervisor makes less than the dealers. That has nothing to do with Wynn paying Sups more- it's how much money the dealers make. If it's not addressed there is no incentive for someone to take a leadership role. The Sup does interact with the guest almost as much as the dealers.
supervisors are on a different career track than the average dealer. supervisors don't have to wear the silly theme shirts and other goofy garb that dealers do. Supervisors don't have to put up with all the snide remarks and jibes that dealers do, not to mention the stinking smoke and booze breath mixed in with the garlic and fanny gas. Lets face it Steve Wynn is stealing the dealers tips to pay his supervisors instead of using his own money. Typical facist. I wish him the very worst luck in all his future endeavors. What was the shylocks name in the Shakespeare play?
This modern day, true life, corporate David and Goliath story is one that all Americans should be watching. If we have not learned in these last few months that our nation's "economic tsunami" was caused, in part, by the greed of major corporations like Wynn Casino, and that worshiped bottom line profit at the end of each fiscal year, than we remain uneducated and naive about the mistakes we have made.
If anyone truly believes that Steve Wynn is not wrongfully at the center of man-handling his dealer's tips that comprise the majority of their income because the "bosses" deserve to make more than the dealers, think again.
The truth of the matter is the floor people at every casino deserve to make at least a comparable income to those they supervise. However, that money should come from the casinos themselves. This industry has been corporately retarded for far too long.
Step up to the plate Mr. Wynn. Pay you're floor supervisors what they are worth. You are, in fact,digging into your dealers income to benefit your corporation. Very simply put, you are using the dealers hard earned tokes to compensate wages that you should be paying to your floor personnel. Your result? The worship goes on for your corporate dollar at the expense of your dealers. Shame on you for thinking you are powerful enough to change the rules after all these years.
Hang in there dealers, stay steady. When your court date arrives, my money is on you.
Excuse me, people, but Steve Wynn is merely "spreading the wealth". Those of you who so enthusiastically voted for Obama's Hope and Change and who are currently pitching a fit over this tip sharing get zero sympathy from me.
And, why should anyone feel badly for you? The fact is that Dear Leader's philosophy is exactly reflective of Wynn's; you may be in a position where you are the direct recipient of the tips, but, soorrryyy, your "success", as the Kenyan himself has explained, is also predicated on the work of others, so it's time to share, share, share!!
Yes, I know; you are the ones that are actually engaging in the work that leads to the tips, but that
doesn't count for too much these days-you need to have dome "skin in the game", people! Time to
return that hard-earned wealth of yours to its rightful owners and all those pit bosses who helped
make your success possible!
Isn't Marxism and the the theft of the fruits of your labor fun? Many of you voted for it in November, now deal with it as defecates on your doorstep.
Narcissa,
If you're going to pull the idea so far out of context, at least go all the way, by your ridiculous definition we would have to steal from the truly rich--Steve Wynn himself.
dos hendersson work for winn he saying the same thing over and over
As a WYNN Dealer myself... The issue is about Nevada and Federal Law. The supervisors (floormen & floorwomen/team leaders) were given tips by Steve Wynn, they are not held accountable for any wrong doing. They are simply doing the same job they did before, and earning tips. No one is mad at them.
Nevada State Law clearly states it is illegal for employers to take tips from any employee (dealer, waiter, bartender, etc.) Steve Wynn is powerful in Nevada, and his money can possibly still buy off politicians, organizations, and private individuals. Federal Law also states that tips cannot be used by an employer to get out of paying wages. By taking tips, in essence Steve Wynn does not pay the dealers minimum wage. He takes more money than he actually pays the dealers. The Federal Courts just ruled in the employees favor on a case just like this in Oregon, it's a fact!
Here's how it works... Steve Wynn's security officers take all the tips off the games, and the money is counted in some secret location. Who knows if all the tip money makes it all the way to our paychecks??? We don't believe it does. There is no way for us to know, because we are NOT allowed to count our own money. How does anyone know if all the tips are there and counted fairly??? Just take the companies word for it huh? Just like Enron employees did with their retirements, or Madoff investors did with their hard earned money.
Waiters, bartenders, dealers, and anyone else who earns tips are subject to their employer taking their tips. The Restaurant Owners Assoc. and Tavern Owners Assoc. are backing Steve Wynn's battle to take employees tips. This is a fact. They have been called on to support Wynn's case against the dealers. If you earn tips, and Steve Wynn is able to take tips legally, every business and casino in the State of Nevada will follow. If a bar, restaurant or casino can save money, by taking a percentage of your tips, THEY WILL !!!
Dealers are tipped for being nice. We were punished at WYNN for being too nice, and making too many tips. A player does tip a supervisor, because the dealer was nice, they tip the dealer. On a rare occasion , a supervisor does get tipped. They should share the tips between all other supervisors.
The issue affects anyone who gets tips in the State of Nevada, not just WYNN Dealers. The sooner all tip earners understand this, the more attention and better results will be achieved.
Why even make laws, if corporations and businesses are aloud to ignore them ???
Rampart Casino tried to take the dealers tips in 1999 and share them with the floor supervisors. The Rampart Casino changed the floormens names to Casino Hosts, and did exactly what Steve Wynn did, and shared tips. The Labor Commissioner stated it was unlawful, and would not be tolerated. Gail Maxwell the Southern Nevada head of the Labor Commissioner's office issued many statements regarding the issue. She stated it was unlawful and illegal. After Steve Wynn took tips in 2006, Gail Maxwell suddenly quit her post, and all records of the Rampart Casino issue were lost. State records that were supposed to be recorded indefinitely... suddenly vanished...
How many news stories have touched this topic ??? None ...They are too scared of Steve Wynn, just as the people of Russia fear Vladimir Putin, or Iran's President Ahmadinejad, or The Red Army of China, or N. Korea people's fear, shall I continue ???
Don't worry everyone, corporations will keep taking until their is nothing left...Russia did the same thing, how are they doing today ???
Jagr is notoriously cheap. He wanted to charge sports writers money for his interviews. He never really had anything interesting to say anyway.
limodriver,
Come back when you learn how to spell or you have something to contribute.
Not being an expert on Nevada law i hesitate to comment. However if nevada law does indeed say that the employer is prohibited from taking a portion of the tips then i would find that quite normal as it is the law in many jurisdictions.That does not mean that other categories apart from dealers are prohibited from participating in the pool.
It would seem that the argument becomes a bit disjointed when tips are shared by category and across shifts and therefore a dealer that gives an excellent service recieves the same as one that is surly.To argue that the customer gives a tip for particular service and to a particular person then surely by the same token it must be illegal or at leqast immoral for the casinos to allow dealers to share tips between themselves as i believe that someone argued that customers would be upset to learn that the tip that they were giving was not actually going in total to the person that they gave it to.Or is the argument that a client knowingly gives a tip to all dealers but not supervisors. I presume that in a "normal"vegas environment it is the house that deals with the administration of the tip pool and that this amount is paid via the payroll department.I only mention that to make the point that the fact that the house deals with the admin does not mean that they take part of the tips when it is redistributed amongst all the dealers. Whats to stop a good tip earning dealer making the same argument that is being presented viz a viz the supervisors to keep the actual tips that they recieve.
The real point however isnt one of law its one of common sense.Steve Wynn has a deserved reputation as being a visionary and has generally a very good reputation world wide in the industry.(even though some people seem not to agree) His properties certainly reflect that.(Many others in Vegas do not).We are in the middle of a worldwide recession from which the casino industry is not immune and any distraction effectively cost employment.
What do people think will happen if the dealers win this case. That the company will be able to absorb the extra costs involved in todays climate. They would have few options , reduce the tip element of the supervisors salaries, keep their salaries the same or keep their salaries the same and look for ways to cover the increased costs (reduce numbers).
The casino business is like any other and has to balance its revenues with its costs . My understanding is that Wynn has a relatively solid balance sheet ,unlike others in your town,and is doing his best to protect as many employee positions as possible.
If it was my liveliehood i would be looking at the best way to protect it beyond next Tuesday week.
Anyone who has any doubts i suggest that they take a trip to France, whose unions took no account of their casinos profitability and were making similar noises 20 years ago, and ask them about the state of their tables industry today.
Ya know u dealers could careless about what a waitress or anyone else gets for tips,u just need to use them for a name signed on a piece of paper,so you can stop the brotherhood bs because u probably would turn your nose up at them if you saw them anyway.You're making 100k a year now.watch the hours cutting session and the layoffs.they have their ways...