Wynn Resorts battle with dealers over tip sharing continues

Updated July 28, 2018 - 11:11 pm

Matt Maddox moved swiftly to put out corporate fires when he replaced Steve Wynn as CEO of Wynn Resorts Ltd. in February.

Within a month he settled the resort operator’s six-year battle with Universal Entertainment. That deal paved the way for the company to settle a different lawsuit filed by Elaine Wynn. Then Maddox raised $1 billion in new capital and quelled rumors of a takeover.

Yet Maddox has not shown any signs of settling what is likely the company’s longest-running battle.

Nearly 12 years ago, hundreds of Wynn Las Vegas dealers filed the first of several lawsuits against the company to stop what they consider to be the unlawful sharing of their tips with “casino service team leads,” who dealers claim are supervisors.

The amount at stake is about $50 million, according to Wynn Resorts and Josh Buck, a lawyer representing the dealers. Wynn agreed to pay an additional $463 million to settle its battle with Universal.

Maddox raised dealer pay by $2 an hour — equivalent to an annual increase of about $4,000 — just two months into his tenure. It was the dealers’ first raise in about a decade.

But for several dealers who talked to the Las Vegas Review-Journal, it doesn’t compare to what they lost.

“They are not fooling anybody,” said Wynn table games dealer Kanie Kastroll, who estimates that she has lost $100,000 or more since 2006. “We want the tip money they have been taking from us the last 12 years.”

The tip sharing structure was “Steve Wynn’s baby,” not Maddox’s, Buck said, adding Steve Wynn’s fight with the dealers had become “personal.”

Buck questioned whether Maddox would really want to “fight to the death” on this issue.

Court cases

U.S. District Court Judge Robert Jones will decide whether a 2011 regulation that was annulled in March was valid during its seven-year existence.The Department of Labor regulation said tips could not be shared with employees who normally didn’t receive them.

Even if Jones were to side with the dealers and award them the $50 million they didn’t receive over that period, it would not necessarily bring an end to the Wynn tip practice because of a change in law.

The Department of Labor regulation was replaced by congressional legislation stating that tips can be shared with other employees who normally don’t receive them. However, the new law forbids supervisors and managers from sharing in the tip pool.

The dealers filed a new suit in May stating that the casino service team leads are not entitled to tips under the new law because they are supervisors.

Another judge will have to determine what defines a supervisor.

Wynn company spokesman Michael Weaver said a casino service team lead does not have powers often associated with the term “supervisor,” such as control over pay and policy decisions or scheduling and disciplining employees.

Weaver said casino service team leads monitor games, not people, and are not supervisors as defined by the Department of Labor.

But Kastroll said casino service team leads carry out many of the same functions as the floor supervisors, such as checking a player’s credit limit and approving the conversion of chips worth more than $500 into larger or smaller denominations.

“It is the same job, just another name,” she said.

Booming business

The role of casino service team lead was implemented in 2006, a little more than a year after Wynn Las Vegas opened.

Amid a booming economy, Wynn Las Vegas gaming tables were so busy during the property’s first year of operation that many dealers worked six days a week and put in more than than eight hours a shift, said Kastroll.

Wynn’s high-end customers were generous with tips. The dealers pooled them among themselves just like their counterparts at other Strip resorts.

Wynn dealers earned as much as $100,000 including overtime in their first year, the company has said. But Kastroll and other Wynn dealers say a six-figure income was limited to those who worked six days a week — sometimes as long as 12 hours a day — and got the best shifts.

The Wynn dealers were monitored by floor supervisors, who themselves were overseen by pit bosses — the standard industry practice.

But the company noticed a discrepancy between the pay of the floor supervisors and dealers.

“As a result of tip income, it has become common for floor supervisors to earn less money than the dealers they supervise,” the company said in a memo dated Aug. 21, 2006. “This results in an inverted system whereby the best dealers do not want to be promoted as should be the case in any employment situation.”

The positions of pit boss and floor supervisor were eliminated and replaced by the position of casino service team lead, whose goal is to improve customer interaction, the company said.

The casino service team lead is entitled to about 15 percent of the dealers’ tip pool, according to the company’s calculation.

Bus boy argument

The company has argued that the casino service team lead deserved to be part of the tip pool much like a busboy in a restaurant. The tip policy change would also help resolve the pay gap between supervisor and subordinate at the luxury resort.

Wynn also said it would allow some employees to work as both a dealer and casino service team lead, further blurring the traditional hierarchy.

The change, in essence, cut dealers’ annual earnings between 10 and 15 percent, according to Kastroll. Hundreds of Wynn dealers have been losing out on a total of about $6 million a year, according to Buck.

Kastroll said her monthly income fell about $800 a month immediately after the policy change. Today, it is down as much as $2,300 compared to 2005 as tips dwindle, she said.

“We were so happy to work at the Wynn when it opened. But this change in policy pitted dealers against supervisors and dealers against dual-rate dealers,” said Kastroll. “It has become a tension-filled environment.”

About 10 Wynn dealers have reached out on their own to the Review-Journal since Steve Wynn’s departure to express similar views about the atmosphere in the table area. However, they asked not to be quoted because of concern over their jobs.

Pay decline

Despite the lost pay, many Wynn dealers like Kastroll who joined on day one continue to work at the property. They say they don’t quit because there are few full-time dealer jobs with benefits at other high-end properties in Las Vegas.

Even if they find full-time work, they say they would not have seniority at another property to receive the most lucrative shifts.

Wynn said their dealers are still among the best paid, even with the tip pooling policy, earning between $70,000 and $75,000 a year based on a 40-hour workweek. Dealers deny the pay is that high.

Kastroll says that even if Wynn dealers are among the highest-paid on the Strip, the policy still reflects poorly on the company’s image as a luxury property.

“We are told every day that the Wynn brand means classy,” said Kastroll. “This policy goes against our brand. This is not a classy thing to do.”

Contact Todd Prince at 702-383-0386 or tprince@reviewjournal.com. Follow @toddprincetv on Twitter.

ad-high_impact_4
Business
Holiday Parade Lights Up Downtown Summerlin
Holiday parade lights up Downtown Summerlin every Friday and Saturday night through Dec. 22.
Nevada's solar industry on the rebound
In 2015, the Nevada Public Utilities Commission voted in favor of a new tariff structure that reduced net energy metering buyback rates and increased fix fees for residential solar customers.
Apartment complexes selling fast in Las Vegas
Las Vegas’ apartment vacancy rate is among the smallest in the country, and rents are climbing faster than the national average. (LVRJ)
Aristocrat Opens $45M Campus In Summerlin
Aristocrat Technologies Chairman Ian Blackburne discusses the company's growth. (LVRJ)
Sunrise Hospital celebrates 60 years
Sunrise Hospital opened its doors to patients on Dec. 15, 1958. Employees of more than 35 years celebrated at a luncheon Wednesday, Dec. 12, 2018. Jessie Bekker/ Las Vegas Review-Journal.
Maya Cinemas to open soon in North Las Vegas
Moctesuma Esparza, CEO of Maya Cinemas, talks about the newest location in North Las Vegas, set to open Jan. 10. The aim of the theatre chain is to serve latino-centric, underserved communities.
Holiday shopping and returns make this the busiest time of year for UPS
The UPS Las Vegas South facility is the company's busiest pre-load operation in the country, and it's even busier this time of year. (K.M. Cannon/Las Vegas Review-Journal)
Primm’s outlet mall has fallen on hard times
The mall, attached to Primm Valley Resort, opened in 1998. Back then, it was a “textbook, perfect outlet-center location." But now, Primm’s outlet mall has fallen on hard times. Las Vegas Boulevard has endless shopping spots. And there are other outlet malls that don’t require a hefty drive to the state line. Its mortgage-holder foreclosed on the mall in late September.
Miltary auction at Ritchie Bros. Auctioneers
Humvees, ammo cans, construction equipment, field gear and more is on the auction block Friday and Saturday at Ritchie Bros. Auctioneers. About 10,000 items in all are for sale in what GovPlanet bills as the largest auction of its kind.
Las Vegas residents discuss avoiding holiday scams
Las Vegas residents discuss their donation habits and how they avoid giving money to scam charities during the holiday season. (Bailey Schulz/Las Vegas Review-Journal)
Tesla’s Nevada Gigafactory ahead of economic impact expectations
The Tesla Gigafactory’s economic impact on Nevada has exceeded projections, bringing in more than 7,000 jobs. In 2014, Nevada agreed to give the automotive and energy company $1.3 billion in tax abatements. In return, Tesla promised to meet certain requirements in areas like employment and capital investment. As of June, Tesla has brought in a total of $6.05 billion in capital investment, surpassing the $4.95 billion projection. The original contract gave the company until 2024 to make $3.5 billion in capital investments in Nevada. Derek Armstrong, deputy director of the Governor’s Office of Economic Development.
Land sales near the Las Vegas Raiders stadium
Land around the Las Vegas stadium site has been selling for high prices. A few months before the stadium’s groundbreaking, Global Trust Group acquired a 2.5-acre parcel just north of the stadium site. The property sold for $7.25 million, or $2.9 million an acre. Osprey Real Estate Capital and Huntington Hotel Group acquired a 2-acre industrial site just west of the stadium site in late November. The property sold for $6.5 million, or $3.15 million per acre. That's roughly 12 times the average price of land in the valley this year as tracked by Colliers International.
T-Mobile Tech Experience Truck parks in Toshiba Plaza at T-Mobile Arena
The Tech Experience Truck is a state-of-the-art showroom on wheels, with demonstrations that put connected drones, smart cities, augmented/virtual reality and smart tracking. The exhibit shows new wireless technology – including 5G and the Internet of Things (IoT). (K.M. Cannon/Las Vegas Review-Journal)
Steve Siegel, CEO of the Siegel Group, speaks about helping families and other needy residents
Steve Siegel, CEO of the Siegel Group, speaks about helping families and other needy residents to keep them from teetering off into homelessness. Bizuayehu Tesfaye/Las Vrgas Review-Journal @bizutesfaye
Crowds camp out for Chick-fil-A opening
Dozens of customers camped out 24 hours ahead of the 6 a.m. Thursday opening of the new Chick-fil-A on Rainbow Blvd.
Cheapest listings for sale in Las Vegas
Listed for $39,990, 585 S. Royal Crest Circle, Unit #9 is one of the cheapest homes currently listed for sale in Las Vegas. (Caroline Brehman/Las Vegas Review-Journal)
MGM's sports betting deals
MGM Resorts International signed a sports betting sponsorship agreement with the NBA in July It was the first professional sports league to have official ties with a legal sports betting house. The deal came just two months after the U.S. Supreme Court overturned a law prohibiting sports betting in most states. In October, MGM became the first gaming company to sign a sports betting partnership with the NHL. In November, MGM became the first gaming company to sign a sports betting partnership with the MLB. Financial terms of Tuesday’s deal and earlier partnerships have not been announced.
Terry Miller discusses Convention Center
Project Manager Terry Miller explains the phases of Convention Center construction.
Zappos treats their team members on Cyber Monday
Zappos rolls out a variety of food, drinks and special activities for all team members at their downtown Las Vegas headquarters for Cyber Monday. (K.M. Cannon/Las Vegas Review-Journal)
Team Hybrid at the 2019-Model Motor Trend International Auto Show
Among the companies showing off the 2019 model cars, Team Hybrid shows off its modified cars. Las Vegas resident David David talks about the team, which is in its ninth year exhibiting at the show, and his show car.
Black Friday Shoppers at downtown Summerlin and at the Arsenal
Black Friday shoppers at downtown Summerlin and at the Arsenal. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfYe
Black Friday shopping in Las Vegas
Black Friday sale shopers express their shopping experience. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Las Vegas Livestock recycling Strip food waste
Las Vegas Livestock collects and recycles food from many Las Vegas Strip companies. (Nicole Raz/Las Vegas Review-Journal)
Black Friday at Fry's
Shoppers line up for deals early on Black Friday at Fry's Electronics on Las Vegas Boulevard South. (Mat Luschek/Las Vegas Review-Journal)
Black Friday shoppers at Best Buy at 5 am
Black Friday shoppers at Best Buy at 5 am on Nov. 23. (Mat Luschek/Las Vegas Review-Journal
Black Friday - 1am Closing Time
Quiet night.
Black Friday - 12:30am - Best Buy Arroyo Crossing
Sam's Town Holiday Lighting Ceremony
On Wednesday, Nov. 21, 2018, Mystic Falls Park opened with its annual tree lighting ceremony, hosted by Boyd Gaming Executive Chairman Bill Boyd. The attraction features a Winter Wonderland theme and holiday-inspired laser light show, available daily Nov. 23 to Jan. 1. (Mat Luschek/Las Vegas Review-Journal)
What Is A Smart City?
George Karayannis, vice president of CityNow, Panasonic’s smart-city arm, explains. (Nicole Raz/Las Vegas Review-Journal)
Walmart uses virtual reality to train employees
Walmart Academy Facilitator demonstrates the VR training program being used by Walmart stores across the country.
TOP NEWS
News Headlines
Add Event
Home Front Page Footer Listing
Circular
You May Like

You May Like