Detroit casino workers' pay stops Wednesday; benefits run through June 30
Sunday 29th March 2020
Detroit -- Thousands of city casino workers are about to see their paychecks halted, as the three major gambling halls have extended their shutdown through at least mid-April.
MGM Grand Detroit, Greektown and MotorCity pledged to pay workers through the original shutdown window, which expires at the end of the day Tuesday.
All three now say the pay will cease beyond that, though each pledged to extend benefits through June 30.
"This decision was extremely difficult to make for all of us," Jay Snowden, president and CEO of Penn National Gaming, which owns Greektown, wrote in a letter to employees last week. "Penn National is a family, and we deeply regret the hardship this will place on you and your loved ones. We are extremely motivated and focused on re-opening our properties as soon as it is safe and legal to do so."
Penn National Gaming owns 41 casinos in 19 states, all of them shuttered. It bought Greektown from Detroit billionaire Dan Gilbert in 2018. It said starting Wednesday, unpaid furloughs will be given to about 26,000 employees.
Also, Penn said there will be "meaningful" pay cuts for Snowden and other people in leadership roles. Its board of directors will forgo cash compensation, and corporate team members also will be furloughed. It announced less than 850 employees will continue working during the shutdown.
It has set up an emergency relief fund, currently at more than $1.2 million, to help employees as well as local relief organizations.
At MotorCity Casino, owned by the Ilitches, "the health and safety of our employees is our top priority," it said in a statement.
"We are hopeful this temporary closure will have a positive impact on stemming the tide of COVID-19," MotorCity added in its statement.
Meanwhile, at MGM Grand, owned by MGM Resorts, it also has set up an employee emergency relief fund, and is working with companies, including Amazon, to get workers temporary employment elsewhere.
Detroit's casinos make up three of the state's 26, with the other 23 being tribal casinos and not regulated by the state. All of them have closed since Gov. Gretchen Whitmer announced a ban on large gatherings.
The three casinos now will stay closed through at least April 13.
Amid their closure, the Detroit three donated thousands of pounds of leftover food to local food banks, with MotorCity and MGM Grand also donating gloves and other supplies to the city of Detroit and bus drivers. Greektown also offered up its property for a temporary health-care site.
The three Detroit casinos, combined, top $1 billion in annual revenue, which is worth more than a hundred million to the state and city in tax revenue. The week before the shutdown, each also opened sports books, which quickly were rendered useless as the sports world all but ceased, costing each property millions in expected early returns.
Statewide, casinos employ about 19,681 workers. The American Gaming Association estimates a two-month shutdown nationwide could cost the country $43.5 billion in economic activity, and $74 billion in lost wages. The casino industry is collectively seeking a federal bailout.