The global gambling industry has taken a major hit because of the coronavirus pandemic, and, in the U.S., all casinos are currently shut down. Hopes of being able to restore operations quickly have been thwarted by the continued presence of the virus, with new orders being implemented to extend the closures through the end of the month. Atlantic City, New Jersey’s gambling hub, was already in a bad way before COVID-19 came into town, and the virus has only made matters worse. As a result, with not enough money in the bank to weather the storm, 16,000 casino employees are now at home, hoping to be able to collect some type of unemployment compensation.
Some casino operators in the country, such as Las Vegas Sands and Wynn Resorts, have enough cash to continue to pay furloughed employees. However, this isn’t the case with those in Atlantic City. The Press of Atlantic City reports that the workers were handed their pink slips so the casinos can save money and allow the employees to file for unemployment compensation. However, once health officials give the all-clear and officials lift the casino suspension, the companies have indicated that they will hire back the employees.
In New Jersey, since the state-wide shutdown began, unemployment claims have continued to rise. In a normal week, there may be around 6,800 applications. However, from March 22 to 28, there were 206,253, and the week prior saw 155,815. These figures make New Jersey one of the top-ranked states for unemployment claims in the U.S.
Initially, when New Jersey Governor Phil Murphy implemented the shutdown on March 16, casinos were prepared to offer compensation plans for their employees. However, in light of the continued suspension, the move to the fire/rehire scheme was chosen.
While some of those now with nothing but free time on their hands might enjoy the forced vacation, it doesn’t come without its drawbacks. These employees are no longer eligible for health insurance, a huge concern given the current health issues, and there is also no guarantee that the casinos will bring back 100% of their employee contingents once they begin to operate. This could be a perfect opportunity for casino operators to review their staffing requirements and cut their workforces going forward.
Hard Rock Hotel & Casino Atlantic City essentially alluded to that fact in a statement regarding the current situation. The Press of Atlantic City quotes the venue’s president, Joe Lupo, who said, “Hard Rock Hotel & Casino Atlantic City is committed to our team members during these unprecedented times, ensuring that our communication has been open and direct. COVID-19 has and will continue to have a tremendous financial impact on our team and business, resulting in incredibly difficult decisions made now and in the future.”
Ocean Casino Resort took a similar stance. It sent a memo to employees that reads, “We plan to reinstate your employment as soon as we have the business needs and are permitted to operate.” The use of “business needs” is subjective.
Both companies, however, have been willing to help their employees as much as possible. For example, Hard Rock will allow eligible employees to use their accrued time off and to “borrow” another two weeks so they don’t have to immediately file for unemployment. Ocean CEO Terry Glebocki has said that she’s committed to bringing back the employees when possible.
