MGM Resorts Joins Caesars With Labor Deal to Avoid Strike (1)

A powerful union of Las Vegas hotel and casino workers has reached an agreement with MGM Resorts International, further softening the threat of a city-wide strike ahead of a grand prix expected to bring 100,000 visitors.

The tentative deal Thursday came a day after the union reached its first agreement with Caesars Entertainment Inc. The labor group must also reach a pact with Wynn Resorts Ltd. by 5 a.m. Friday to avoid a strike. MGM employs about 25,000 union workers across eight Las Vegas properties who must now approve the deal.

All three casino operators are racing to reach a deal with Culinary Workers Union Local 226 before a Formula One race weekend that kicks off Nov. 16, projected to bring the city nearly $1.3 billion—more than double the economic impact of the Super Bowl scheduled for February.

The union said the five-year agreement includes the “largest wage increases ever negotiated” in its 88-year history, but didn’t provide specifics. The deal also increases guardrails on technology that can displace workers or track them, and boost on-the-job safety protections, the union said.

The pact reinstates daily room cleaning, a practice that was halted during the Covid-19 pandemic. That cut eliminated jobs and overwhelmed staff who were given greater workloads, the union has said. It also said the deal boosts job security by extending what’s known as recall rights, which allow workers to return to their jobs if another pandemic or economic crisis were to arise.

The labor dispute was months in the making, with workers laboring under expired contracts at 18 resorts on the Vegas strip, including the MGM Grand, Bellagio, and Caesars Palace.

MGM Resorts reported Wednesday a net revenue of $4 billion for the third quarter of 2023, a 16% increase over the previous year. But it also reported a drop in revenues on the Vegas strip, from $2.3 billion to $2.1 billion.

The Las Vegas union standoff is the latest in a series of big labor disputes fueled by soaring living costs in cities, a tight labor market, and record corporate profits. The unrest has hit Hollywood, as well as the health-care and auto industries, with workers often emerging with bigger-than-usual raises.

(Updated with additional reporting throughout. An earlier correction fixed the spelling of Caesars in the headline.)

To contact the reporter on this story:
Ian Kullgren in Arlington at ikullgren@bloomberg.net

To contact the editors responsible for this story:
Genevieve Douglas at gdouglas11@bloomberg.net

Jay-Anne Casuga, Laura Francis

© 2023 Bloomberg L.P. All rights reserved. Used with permission.