Caesars Southern Implements Mass Layoffs Through Employment Loophole

A significant number of layoffs have been issued at Caesars Southern Indiana’s property.

Last week, the casino dismissed approximately 200 employees through departmental Zoom calls.

Of the 200 laid off, a significant number were employed in the casino’s service departments. COVID-19 restrictions at the property led to service workers such as bartenders, waiters, and hosts being predominantly affected by the layoffs.

Coronavirus creates casino problems

This year, the coronavirus pandemic necessitated a shutdown of about three months for Caesars Southern. This was a scenario mirrored by all casinos in Indiana.

Caesars Southern put almost 1,200 of its employees on furlough in an attempt to weather the storm when it was forced to shut down.

Despite the casino reopening for business in June, many employees are still not back at work.

Many of the employees impacted by the layoffs last week had been on furlough since March.

The union Unite Here Local 23 represents the casino workers who are now unemployed. Out of its members, 45 lost their jobs due to layoffs, while 10 barely escaped the same fate by changing departments.

Stuart Mora, the president of Unite Here Local 23's Indiana chapter, stated that the layoffs were a result of the restrictions imposed by the Indiana Gaming Commission (IGC).

Currently, the IGC permits waitstaff in casino restaurants, but forbids the service of drinks on the casino floor.

Mora challenges this distinction, arguing that the same activity is simply occurring in different parts of the building. He conveyed this to Play Indiana by stating:

“It’s unclear to us why servers are permitted in steakhouses and restaurants, yet they’re not permitted to serve drinks on the floor. We’re struggling to see the distinction. While this change might not salvage all cocktail server jobs, our goal is to restore as many people as we can to full-time employment.”

The layoffs may not turn out to be a permanent situation.

If the casino is going to bring those employees back at all, March 2021 is the deadline.

Nonetheless, the distinctive circumstances at Caesars Southern could make that more challenging than it sounds.

Southern Indiana’s Caesars property is on the market

Before the year ends, Caesars will be surrendering the keys to the casino.

A few months ago, the IGC approved Caesars’ merger with Eldorado Resorts, but this approval was accompanied by a few conditions.

According to the agreement, Caesars is required to sell three of its Indiana casinos before December 31, 2020. One of the properties to be sold is Caesars Southern Indiana.

Those employees might not reach the March deadline, as Caesars Southern will be owned by a new company by the end of the year.

Once a new company assumes control, anything is possible. The new owner might choose to rehire employees, or they may decide to increase the number of layoffs.

Currently, Caesars has an employment agreement with the IGC, which the new owner will not be required to uphold.

That agreement was intended to avert layoffs at Caesars properties, but it isn’t foolproof.

Casino layoff loophole

A remaining condition from the Eldorado merger stipulates that Caesars must maintain its current employment levels at its casinos until July 10, 2023.

This is where the layoffs at Caesars Southern come into play.

The requirement for the level of employment was established from a series of guidelines that the IGC and Caesars negotiated over the summer. One of these guidelines offers some flexibility for layoffs related to COVID.

When evaluating adherence to this requirement, the Commission staff will take into account disruptions due to the ongoing COVID-19 pandemic. The assessment of New Caesars will be based on overall industry trends, with considerable emphasis placed on other Indiana casino licensees.

The “disruption” caused by the coronavirus enabled Caesars Southern to bypass the requirement to maintain employment levels and issue layoffs.

In other words, as long as they’re linked to the pandemic, Caesars can implement layoffs.

The IGC is currently assessing requests to increase capacities for table games and other activities within casinos. This could possibly result in the commission lifting its prohibition on drink servers throughout the casino floor.

While that would assist many members of Unite Here Local 23, it wouldn’t encompass everyone.

Many of the approximately 200 workers who were laid off are hosts, valets, poker room workers, and kitchen staff.

Until things return to normal, everyone at Caesars Southern will be unemployed.

Considering the unpredictability of the pandemic and the sale of the casino, many of those jobs could potentially be lost permanently.