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Best of Liz Benston

Gaming Guru

Liz Benston

Atlantic City Casinos Look to Replace Workers

26 October 2004

ATLANTIC CITY -- At least two of the four casino companies involved in a long-running strike in Atlantic City have raised the stakes by saying they will begin hiring replacement workers to fill positions vacated by union members on strike.

Some 10,000 workers represented by Local 54 of the Hotel Employees and Restaurant Employees union in Atlantic City walked off the job Oct. 1, seeking better wage and benefit terms as well as a three-year contract, among other things.

Negotiations between the casino companies and parent union UNITE HERE fell through Friday, though officials on both sides say talks remain ongoing.

In recent days, Harrah's Entertainment Inc. and Caesars Entertainment Inc. -- the two largest companies involved in the strike -- have run newspaper ads in Atlantic City seeking workers.

"This is not a step we're taking lightly," Harrah's spokesman David Strow said Monday. "This is the last thing we wanted to have happen. We really do not have any other choice at this point. We cannot continue to bring in workers from other properties indefinitely."

"We consider that nuclear war," UNITE HERE Executive Vice President of Gaming D. Taylor said of the hiring efforts Monday. Taylor also is secretary-treasurer of the Culinary Union in Las Vegas, a UNITE HERE affiliate.

"We think it will just prolong this strike and make it more acrimonious," Taylor said.

Federal labor laws allow companies to hire replacement workers on a permanent basis during a strike, as long as the dispute involves economic terms. If a company later negotiates a deal with a union, the company isn't obligated to hire back the strikers unless it hires additional workers on top of the temporary employees already working at the company.

Those rules give companies an edge over unions during a strike, said David Hames, a labor expert and associate professor in the Department of Management at UNLV.

"If I'm one of the strikers and I want to keep my job, it probably puts more fear in my heart if I want or need that job to know that (the company) is not entitled to give me my job back," Hames said.

Union interests have attempted to amend the law to prohibit permanent replacements, but to no avail, he said.

Harrah's and Caesars are approaching the dispute differently.

In an ad that ran Sunday, Harrah's said it will be hiring "permanent replacement workers" for hotel and restaurant positions at a job fair in Atlantic City today. "We have an obligation to run our business," the ad said. In a second ad Sunday, Harrah's reiterated previous statements that the company has met the union's demands -- including higher wages, company-paid health benefits and increased pension contributions -- except for the three-year contract.

The casinos have stuck to demands for a five-year contract, saying a three-year contract -- which is what the union has in Las Vegas -- would give the union too much clout and allow it to strike properties in Las Vegas and Atlantic City at the same time. UNITE HERE has said it wants more bargaining power because companies are getting more powerful through mergers.

Caesars ran ads last week announcing a job fair last Friday. The ads don't reference the dispute and call for "full-time and part-time" jobs. The ads don't specify whether the jobs would be permanent or temporary.

When asked about the status of the jobs, Caesars spokesman Robert Stewart would say only that it was "a matter for further discussion" with the union.

Like Harrah's, Caesars continues to use managers to make beds, serve drinks and perform other tasks normally reserved for union employees. Caesars also has hired temporary help on a contract basis, Stewart said. Harrah's has about 2,000 union workers and Caesars has about 6,000.

Colony Capital representatives declined to comment on the status of their employment situation at Resorts Atlantic City, and officials with Aztar Corp., which owns the Tropicana resort in Atlantic City, could not be reached for comment.

Harrah's and Caesars have said that at least 10 percent of union workers have crossed the picket line to return to their jobs. Only a few services have shut down since the strike, they say.

Taylor said the return rate for workers was "abysmally low" for a strike and said the ongoing public protest, including a rally in Trenton, N.J., on Monday, is hurting profit at the casinos.

"We know we're having a gigantic effect on them -- they're serving food on paper plates," for example, he said.

Taylor said the union is far apart from the companies on more than the contract term. Friday's proposal would have given the companies wiggle room to increase health payments for workers and would have allowed them to subcontract jobs -- including thousands of positions held by hotel and restaurant workers -- to nonunion employees, he said. Casino representatives dispute that characterization.

Companies that warn of permanent replacements are generally implying that strikers won't necessarily get their jobs back, Hames of UNLV said. On the other hand, companies looking for "temporary" workers are hinting that those workers wouldn't be kept on once the strike ends, he said.

Strow said Harrah's is still negotiating with the union in spite of the job search. "We remain cautiously optimistic that this can be resolved," he said.

The job fair will be part of a "gradual" hiring process, he added.