The Porto Rio Hotel & Casino in Greece may soon just be known as the Porto Rio Hotel. The casino has been closed indefinitely as of this past Monday due to a dispute with employees, who are on 
strike after the casino asked them to reduce their work hours and take a cut in pay of up to 25%. The situation is exacerbated by the revelation that some employees haven’t been paid for the last 14 months.
According to the workers’ union, employees are owed more than €5 million (US$5.64 million). Dimitris Karageorgopoulos, the head of the union, indicates that an agreement to make good on the outstanding debt has called for the casino to immediately pay €800,000 ($903,561), but the casino has, apparently, opted to shut down instead.
The casino accuses the employees of causing the rift. It sent a letter to the workers this past Sunday, alleging that the union has threatened the casino’s survival and that the union’s actions are forcing its hand. It added that it is discussing potential investments with three different unidentified entities. Those investors could potentially bail out Theros International Gaming, which owns casinos at the Rio and in Corfu and Alexandroupoli.
Part of the letter reads, translated from its original Greek, “The company announces that the shutdown of the casino is due solely to the ongoing attempts to confiscate the casino’s reserve by a group of employees. Even this morning after stoppage and shutdown of the casino there has been an attempt by union to confiscate the reserves, which cannot continue, the company is not able to withstand it, and the company is obliged to defend its existence…”
Theros indicates that the average wages of Rio casino employees is around €1,470 ($1,660), but the average cost of maintaining the employees is €1,840 ($2,078). It says that wages need to be reduced by “more than 31%” and possibly 70 jobs might need to be eliminated.
It would seem that the casino operator didn’t perform enough due diligence prior to launching the operations. It adds in the letter, “The business exists because the shareholder has borrowed money and put it in a wound that bleeds without end. This feature has dried up. The only solution is the entry of investors who, after a lot of negotiation, with difficulty and risk, decided to invest some money. In order to do this, the company must be put on the right track.”
The “right track,” according to Theros, is based on requirements stipulated by a potential investors. These requirements include paying off existing creditors, stabilizing wages for a period of possibly one year and creating new investments that are aimed at “stabilization and growth.” However, Theros also indicates that turnover at the casino has fallen by 74% over the past six years. With that type of decline, the chances of a growth investment turning things around are slim.
