by ANDREW BARBANO
Casino pours water on the drowning
Expanded from the 12-2-98 Daily
Sparks (Nev.) Tribune
- The Daily Sparks Tribune yesterday broke the story about how
one of the richest gambling families in northern Nevada is trying to beat
375 laid off workers out of any severance pay.
The Riverboat Hotel-Casino
in downtown Reno fired all its workers without notice at 9:00 a.m. on
Monday, Nov. 30. The hotel also rousted its guests and unceremoniously
sent them packing to the Riverboat's sister hotel, the Comstock, a block
away. The Douglass family owns interests in both properties as well as
the huge Club Cal-Neva across from Harrah's-Reno Hotel-Casino.
Nobody but the muckrakers
at the Tribune and a union member from Sparks thought to question the
legality of the casino's actions.
When journalist Willie
Albright (who also contributes reports to National Public Radio and National
Native News), asked about compliance with the federal Worker Adjustment
and Retraining Notification (WARN) Act, the company tried to crawl through
a narrow legal loophole by using the Nov. 3 passage of California's Proposition
5 as an excuse. The far-off threat of California Native American gambling
is now in vogue for the Nevada casino industry as a catch-all excuse to
deflect blame and avoid responsibility.
TWO PAPERS, TWO STORIES
FROM MANAGEMENT. "Lori Keller, vice-president of marketing for the
Riverboat, said that the casino has been operating in the red for a few
years and that negotiations with two potential purchasers were terminated
the day after Prop. 5 passed and efforts to secure a joint-venture partner
failed," the Tribune reported.
However, the Reno Gazette-Journal
in its Tuesday, 12-1-98, front page story, noted that the Riverboat had
been profitable until this year.
The owners "attempted
to revive the decade-old Riverboat with a $2 million remodel and a new
management team," the Reno paper reported.
"But when the hotel-casino
could not recapture the slim profits it eked out until 1998, the owners
decided to sell," the Gazette-Journal noted.
"According to Keller,
employees were not given notice of the closure on the advice of Riverboat
attorneys who said the WARN Act does not apply because the casino was
in a distressed situation. The 60-day notice requirement could have been
met with two months severance pay, but Keller said employee severance
packages consisted only of vacation pay and pay for those scheduled to
work Monday," Albright wrote.
LABOR LAWYER DISAGREES.
The Tribune contacted veteran Reno labor lawyer Michael Langton (775-329-7557).
Among others, Langton represents the Building and Construction Trades
Council of Northern Nevada/AFL-CIO, Teamsters Local 533, Laborers' Union
Local 169 and the Nevada Classified School Employees Association. Langton
himself is a longtime member of International Brotherhood of Electrical
Workers Local 357 based in Las Vegas.
"According to Langton,
Riverboat officials had enough forewarning of the passage of Prop. 5 to
have given their employees notice as required under the WARN Act," the
"Langton said the distressed-situation
argument does not apply because owners knew for months that Prop. 5 was
likely to pass. The WARN Act requires 60 days notice, but does not require
management to follow through with layoffs. Langton said a prudent employer
would have given the employees notice of the pending sale.
"Barring that, he said,
the employees should have been given the severance pay. The situation
opens up the possibility of a lawsuit, Langton said...Keller added the
Riverboat did not feel compelled to give severance pay in lieu of notice,"
CROCODILE TEARS DEPT.
"Our greatest concern is for our employees," said Riverboat co-owner Bill
Douglass in a press release.
"We have discussed the
situation with several area casinos and are grateful to the Reno gaming
community for its support at this difficult moment," the press release
I wonder if the gentleman
gambler has ever heard the adage "put your money where your mouth is."
Alone among local media, this column has predicted downtown closings for
the past several weeks. (See the 11-22-98
and 11-29-98 Barbwires.)
Alas, the Riverboat is but the latest to fall in a continuing line of
dinosaurs playing dominoes.
"John Douglass, CEO of
the Comstock Hotel-Casino and brother of Bill Douglass, said the Comstock
is not going to close its doors anytime soon," according to the Tribune.
For the sake of the Comstock
workers, let's hope he's right. If the worst happens, I hope he treats
his employees better than did his brother.
ROLLING OVER AND PLAYING
DEAD. "I spoke to a member of the 'Rapid Response' team from the Nevada
Employment Security (Dept.)," read an e-mail from a Sparks union man.
"I saw him at the job
fair at the Old Town Mall. He stated that there was a loophole in the
CFR (Code of Federal Regulations) that allows 'distressed' businesses
to withold notification. Apparently, the only way employees WILL get notice
is if the employers say, in effect, that we've made so God damn much money
that we have to close the business to have the time to watch our stash.
I think that the 375 displaced workers should get together and form an
ad hoc union by filing that lawsuit lawyer Langton mentioned to
The employees of the
recently closed Holiday Hotel were treated far differently. Despite hard
times, the Holiday did not lay off workers last winter and this year gave
its employees enough notice before closure.
The Holiday "shut down
just before Halloween, a month earlier than originally planned because
revenues were slipping too quickly. The 175 displaced workers were paid
through last week," Reno Gazette-Journal reporter Ken Alltucker wrote
on Dec. 1.
When former Nevada Lt.
Gov. Bob Cashell (R) closed the downtown Reno Horseshoe Casino, he likewise
followed the law and gave his employees 60 days notice.
Old Reno and her casinos
used to take care of people during hard times. The new Reno is as heartless
as a brass statue.
Say a little prayer for
the displaced workers. May they go forward and kick some serious ass in
Be well. Raise hell.
WARN ACT language excerpted from a United
States Dept. of Labor bulletin
The exceptions to 60-day notice are:
(1) Faltering company. This exception, to be narrowly construed,
covers situations where a company has sought new capital or business
in order to stay open and where giving notice would ruin the opportunity
to get the new capital or business, and applies only to plant closings;
(2) unforeseeable business circumstances. This exception applies to
closings and layoffs that are caused by business circumstances that
were not reasonably foreseeable at the time notice would otherwise
have been required; (Emphasis added.)
The WARN Act is Public Law 100-379 (29 U.S.C. 210l,
et seq.) The Department of Labor published final regulations on April
20, 1989, in the Federal Register (Vol. 54, No. 75). The regulations
appear at 20 CFR Part639.
vu all over again...and yet again BARBWIRE, March 25,
1998, 2007 Andrew
Barbano, a member of CWA Local 9413, is a 30-year Nevadan and editor
of NevadaLabor.com He
was gubernatorial campaign manager for State
Senator Joe Neal.
Barbwire by Barbano
has originated in the Sparks
Tribune since 1988.