Caesars Southern Implements Mass Layoffs Through Employment Loophole

Posted on October 8, 2020

Caesars Southern Indiana has issued a large round of layoffs at its property.

The casino laid off around 200 employees via department Zoom calls last week.

Many of those 200 worked in service departments at the casino. Service workers like bartenders, waiters and hosts took the brunt of the layoffs due to COVID-19 limitations at the property.

Coronavirus creates casino problems

The coronavirus pandemic forced Caesars Southern to shut down for about three months this year. That was the case with all of Indiana’s casinos.

When Caesars Southern shut down, it placed nearly 1,200 of its workers on furlough to try and ride out the storm.

But even though the casino reopened for business back in June, many of those employees still aren’t back at work.

A large portion of the employees affected by last week’s layoffs had been on furlough since March.

Unite Here Local 23 is one of the unions that represents the now-unemployed casino workers. Forty-five of its members lost their jobs in the layoffs, and another 10 narrowly avoided the situation by switching departments.

According to Stuart Mora, the president of Unite Here Local 23’s Indiana chapter, those layoffs were issued because of the Indiana Gaming Commission’s (IGC) restrictions.

Right now, the IGC allows servers at restaurants within casinos, but doesn’t allow drink service out on the casino floor.

Mora takes issue with that distinction, since it’s the same activity that’s taking place, just in different locations throughout the building. He told PlayIndiana:

“We don’t really understand why servers are allowed in steakhouses and restaurants but they’re not allowed to serve beverages on the floor. We just don’t understand what the difference is. Now it wouldn’t save all the cocktail servers, I’m sure, but any person that we can get back to full-time work is obviously what we’re aiming for.”

The layoffs might not end up being a permanent situation.

March 2021 is the deadline for the casino to bring those employees back, if it’s going to at all.

However, the unique situation at Caesars Southern might make that easier said than done.

Caesars Southern Indiana up for sale

Caesars will be handing over the keys to the casino before the end of the year.

When the IGC gave the green light to Caesars’ merger with Eldorado Resorts a few months ago, that approval came with a few conditions.

Per that agreement, Caesars needs to sell three of its Indiana casinos by Dec. 31, 2020. Caesars Southern Indiana is one of the properties that’s changing hands.

Since a new company will own Caesars Southern by the end of the year, those employees might not make it to that March deadline.

Anything could happen once a new company takes over. The new owner could bring employees back, or they might opt to add more layoffs to the pile.

Caesars currently has an agreement with the IGC regarding employment that the new owner won’t have to honor.

That agreement was designed to prevent layoffs at Caesars properties, but it isn’t airtight.

Casino layoff loophole

Another leftover requirement from the Eldorado merger is that Caesars must keep the employment levels at its casinos the same until July 10, 2023.

That’s where the layoffs at Caesars Southern enter the picture.

That employment-level requirement was based on a set of rules that the IGC ironed out with Caesars over the summer. One of those rules provides some wiggle room for COVID-related layoffs.

“In analyzing compliance with this requirement, Commission staff will consider disruption caused by the ongoing COVID-19 pandemic and New Caesars will be assessed against overall industry trends with weight given to other Indiana casino licensees.”

That coronavirus “disruption” allowed Caesars Southern to use the rule to issue layoffs regardless of the requirement to keep employment levels the same.

So in other words, Caesars can issue layoffs as long as they’re related to the pandemic.

The IGC is now reviewing requests to expand capacities within casinos for table games and other activities. That may eventually lead to the commission revoking its ban on drink servers throughout the casino floor.

That would help out many of Unite Here Local 23’s members, but it wouldn’t cover everyone.

Out of the approximately 200 laid-off workers, many of them are hosts, valets, poker room workers and kitchen staff.

All of them will be without a job at Caesars Southern until things get back to normal.

Given the uncertainty surrounding the pandemic and the sale of the casino, many of those jobs could end up being gone for good.

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Jake Garza

Jake Garza is a US Gambling Industry Analyst for Catena Media. He specializes in Midwest sports betting and casino content. Prior to covering the legal gambling industry, he spent time as a professional sports writer, reporting on teams such as the Cincinnati Bengals, Indianapolis Colts and Indiana Pacers. Garza is currently working as a Managing Editor for PlayIndiana and PlayOhio, with previous stops at other well-known brands such as PlayIllinois and PlayMichigan. He has been covering the gambling industry since 2019, and currently works with a team of other journalists to provide comprehensive coverage of the legal U.S. gambling industry.

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