Two proposed multibillion-dollar gaming deals announced less than a week apart would put 17 Las Vegas Strip casino resorts under new ownership, prompting questions about whether the transactions will affect tens of thousands of employees who work for Caesars Entertainment Inc. and MGM Resorts International in Southern Nevada.
Combined, Caesars and MGM employ approximately 70,000 workers in Las Vegas, including roughly 35,000 members of Culinary Workers Union Local 226. The and would take two of the Strip’s largest public casino operators private, shifting control from shareholders to new ownership groups led by Fertitta Entertainment Inc. and Barry Diller-backed People Inc.
Labor leaders and hospitality experts say most frontline employees are unlikely to face immediate impacts from the proposed transactions, though corporate and management positions could face greater scrutiny as new owners evaluate costs and operations.
Union contracts offer protections, but uncertainty remains
“We’ve been through big sales before,” Culinary Secretary-Treasurer Ted Pappageorge said.
Pappageorge said the union’s contracts require successor owners to honor existing collective bargaining agreements, protecting workers’ seniority, benefits and employment rights after a sale.
“The challenges are companies are going to clean house and let go workers, requiring them to reapply and you lose your benefits or seniority,” Pappageorge said. “But we have strong union contracts that mandate that any sale or new owners have to assume the contracts.”
About 35,000 Culinary members work at Caesars and MGM properties, accounting for approximately 60 percent of the union’s membership, according to Pappageorge.
“What’s unprecedented is the fact that these two massive companies are in play at the same time. That is somewhat unusual,” he said. “But it seems to be a sign of strong interest in Las Vegas.”
Where job cuts typically happen
While union protections may help shield many frontline workers, hospitality experts say mergers typically create pressure to eliminate overlapping positions at the corporate level.
“If you are in the front of the house, more property-level staff, you should not be worried too much,” said Cass Shum, an associate professor of hospitality at UNLV who studies labor issues. “As long as the lights are still on, you will have a job.”
Instead, Shum said the greatest risk often falls on corporate departments where duplicate functions can be consolidated.
“Corporate staff tends to duplicate when there are mergers and acquisitions,” she said. “If you are working in corporate finance and those kinds of areas, there is a little bit more risk.”
