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November 27, 2014

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Union-backed group critical of Station reorganization plan

A group of Station Casinos Inc. workers backed by the Culinary Union is objecting to Station’s reorganization plan, saying some employees including union supporters may lose their jobs as casinos change hands.

An objection was filed Wednesday in Station’s bankruptcy case by the “Informal Committee of Station Employees,” which says it consists of 10 employees from 10 Station properties and was formed to represent the interests of hourly employees in the case.

“No one who has appeared before in this case has taken the interests of these employees into account despite the great contributions they have made and continue to make to the survival and future success of the Station hotel-casinos,” said the committee’s objection, which was filed by Culinary Union and Bartenders Union attorney Richard McCracken.

“The (reorganization plan) provides no protection for them. It does not require that they be retained in any of the contemplated transactions. The Employees’ Committee therefore urges the court not to approve the plan unless retention of existing employees is part of it,” the objection states.

The Culinary Union, known for representing workers at large Las Vegas Strip properties, has been trying to organize workers at the locals-oriented Station.

Station owners the Fertitta family and Colony Capital have proposed that they invest in a new company that would own four “PropCo” hotel-casinos being foreclosed on by lenders and that would also own a fifth property.

These properties are Red Rock Resort, Sunset Station, Boulder Station, Palace Station and the Wild Wild West.

“On the PropCo side, the jobs of all existing employees at the PropCo properties are explicitly put at risk,” McCracken’s filing said. “The (plan) states that, after the plan becomes effective, New PropCo will provide its employees with ‘pay increases,’ restore the 401(k) match, and ‘other steps’ so that they will enjoy ‘competitive wages and benefits.’

“However, it is silent as to whether New PropCo will retain the approximately 6,300 current employees at the four PropCo properties so that they may enjoy the promised improvements as well as keeping their seniority, accrued vacation, and existing health insurance and other benefits,” McCracken’s filing said.

The Fertittas, Colony Capital and the PropCo lenders also plan to bid on 13 more “OpCo” gaming properties.

“With respect to the OpCo assets, the (plan) also offers no concrete provisions to protect existing employees. The assets for sale include thirteen casinos that employ approximately 5,300 employees,” the filing said.

“The Bidding Procedures Motion includes a detailed description of the debtors’ proposal for how to conduct the sale and likely auction of these properties. There is only one mention of workforce retention: a ‘Qualified Bid’ must be one that ‘contains any proposed measures associated with the continued employment of the employees,’ among other requirements,” the filing said. “This vague and ineffectual formulation would seem to allow anything from a simple promise to contemplate the possibility of retaining existing employees to a strong contractual requirement that all existing employees must be able to keep their jobs after the change in ownership. But even this vague language disappears in the next section on ‘Evaluation of Competing Bids,’ where workforce retention is not explicitly identified among the factors to be considered for evaluating qualified bids.”

Noting the Culinary Union has filed a complaint claiming Station has harassed union sympathizers, Wednesday’s motion said: “For all the current Station employees, on either the PropCo or OpCo side, the (reorganization plan) offers no job security even as it proposes sweeping ownership changes to all of Station’s casinos. This is hardly a proposal to maintain morale and inspire confidence among Station’s more than 11,000 employees.”

“These transactions might be used as opportunities to weed out union supporters,” the filing said.

The workers’ filing said the bankruptcy court should order the debtor “to stop its illegal, anti-union campaign” and should require that any sale include a provision requiring the retention of employees as the union says was done in the Aladdin (now Planet Hollywood) case.

Station, which has denied wrongdoing in its dealings with the union, hasn’t yet responded to the workers’ filing.

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