Las Vegas-based Station Casinos, which has been paying its workforce through May 16, said Friday it would now lay off 39% of the company’s fulltime employees because the Nevada-mandated casino closures due to the COVID-19 pandemic have been extended well into the month.
In a letter to employees obtained by CDC Gaming, Station Casinos CEO Frank Fertitta III said the uncertainty surrounding any reopening is forcing the casino company “to make some very difficult decisions that will impact a portion of our workforce.”
The letter did not disclose how many workers are impacted by the layoffs. Company officials declined to comment. In a statement late Friday night, the company said the reductions would cover 39% of its workforce.
In addition, the Station Casinos – which is one of the largest locals casino operators in the Las Vegas Valley – will phase in re-openings when allowed, leaving four of its Southern Nevada casinos closed for an indefinite time period.
Governor Steve Sisolak said Thursday that some non-essential businesses, closed since March 18, will be allowed to reopen on a limited basis. The state’s casino industry, including the Las Vegas Strip, will remain closed indefinitely.
Station Casinos said it would open just one of its resorts near the Strip – the flagship Palace Station – when allowed by the state. The off-Strip Palms Casino Resort, which underwent $690 million in renovations over the past two years, will remain closed.
Station Casinos, the operating subsidiary of Red Rock Resorts, oversees nearly 20 large and small casinos in Southern Nevada as well as the Graton Resort in Northern California. All were closed by the coronavirus pandemic.
According to the company’s 10K filing with the Securities and Exchange Commission, Red Rock Resorts had approximately 14,000 employees at the end of January.
The company has had a long dispute with Culinary Workers Local 226, Nevada’s largest labor union. Workers at seven of the company’s properties have voted in favor of being represented by the union, but contracts have yet to be negotiated.
“The Culinary and Bartenders Unions have sent a letter demanding immediate bargaining for thousands of workers that we represent, Culinary secretary-treasurer Geoconda Argüello-Kline said in a statement. “The Culinary and Bartenders Unions will fight to ensure all workers are retained and do not have to reapply for their jobs, that their seniority remains intact, and that all workers are offered extended recall rights when the casinos reopen.”
Laid-off Station Casinos workers will be paid through May 16, per the company’s prior commitment. Medical, dental, and vision benefits will be extended until Sept. 30, 2020. Employees who are not laid off will continue to receive regular pay and benefits through at least May 31.
Station Casinos, along with Wynn Resorts and Las Vegas Sands, were the only gaming companies that committed to pay employees through the coronavirus shutdown, which has closed casinos in Nevada as well as nearly 1,000 commercial and tribal gaming properties in an additional 42 states.
In the letter to employees, Fertitta said the company will take a phased-in approach to open once gaming is permitted to return in Nevada.
Fertitta said the initial properties to reopen would be Red Rock Resort in Summerlin, Green Valley Ranch Resort in Henderson, Santa Fe Casino in North Las Vegas, Boulder Station, Palace Station, Sunset Station, and the company’s smaller Wildfire properties. Four other properties – Palms, Fiesta Henderson, Fiesta Rancho, and Texas Station – will reopen “once we have a chance to assess how our business is performing in a post-COVID-19 world.”
Fertitta said the phased approach, along with the expected impact of state-mandated occupancy and social distancing restrictions, “means that we have to make meaningful staffing level reductions both at the properties that we will open first and at our corporate office.”
Significant reductions in staffing, Fertitta said, were made at the four properties not reopening in the initial phase.
“Please know these are not decisions that we took lightly,” Fertitta said. “This has been the most challenging and painful situation in our company’s history. We are hopeful though that Las Vegas will rebound swiftly and allow us to rehire many of our valued team members when we emerge on the other side of this crisis.”
In April, Fertitta and his brother, company Vice Chairman Lorenzo Fertitta, said they would forgo their salaries for the duration of the COVID-19 pandemic.
In the letter, the company encouraged laid-off employees to apply for unemployment insurance benefits.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
