MGM Resorts: Las Vegas casino layoffs could become permanent Aug. 1

Tuesday 19th May 2020

LAS VEGAS - An unprecedented economic slowdown in the wake of coronavirus forced MGM Resorts International to temporarily lay off nearly 63,000 resort workers.

Now those furloughs may soon become permanent cuts, according to a company letter sent to Nevada employment officials last week.

"We were optimistic at the time of the initial layoff in March that we would be able to reopen quickly," wrote MGM Resorts' Senior Vice President of Human Resources Laura Lee in a May 11 notice to the Nevada Department of Employment, Training and Rehabilitation. "However, we have had to reassess our reopening date given the duration and severity of the COVID-19 pandemic."

Given the unknown nature of COVID-19 and how it might spread in coming months, MGM Resorts can't promise employees will keep their jobs, the letter said.

"Our sincere hope continues to remain that this layoff is temporary, but in light of the continuing pandemic and our extended closure, we are unable to say that the layoff may not last more than six months for at least some portion of our employees," Lee wrote.

The expected date of separation: Aug. 31, according to the notice.

Read the full letter here:

The letter came days after a company earnings call revealed the depth of economic fallout and the extent of layoffs that put tens of thousands out of work.

"The most difficult step," said MGM Resorts' acting CEO Bill Hornbuckle, "was to furlough nearly 63,000 employees. This was painful and it's a hard decision to make, but we are actively preparing for the day that we can welcome them back."

Yet the notice to Nevada officials warns that many of those employees may not return.

"Although we continue to remain hopeful that this layoff is temporary," Lee wrote, "we are unable to assess a more specific return to work date, and we are providing your agency this notice that the layoff beginning during the 14-day period from March 2, 2020 through March 15, 2020, may continue beyond six months and/or could be permanent."

MGM Resorts, operator of a dozen properties in this gambling and entertainment capital, forecasted a grim financial future: significant decrease in revenue, cancellation and non-booking at hotels, restaurants and entertainment events - as well as postponements and cancellations of convention bookings.

The spread of COVID-19 has staggered stock prices of Las Vegas casino companies like MGM Resorts. In late February, the company's stock price hovered around $32 per share.

The stock today is less than half that.

While some companies anticipate opening on June 1, Nevada Gov. Steve Sisolak has not ruled out reinstating stricter virus-prevention measures if there's a spike in new COVID-19 cases or hospitalizations.

Nevada has started the first phase of its COVID-19 recovery plan, softening a mid-March shutdown on certain nonessential businesses. Sisolak has yet to offer a firm timeline for moving on to the second phase of the reopening blueprint.

As hotels plan reopening dates, COVID-19 cases continue to rise in Nevada.

The number of confirmed cases of COVID-19 in Nevada crested 7,000 on Tuesday, increasing to 7,046.

That's a jump of 140 cases over what was reported Monday, according to new numbers posted to the Nevada Health Alliance dashboard.

The number of deaths in the state remains at 365.

Source

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