Las Vegas Sun

June 18, 2024

Union calls Virgin Hotels’ ‘final’ offer in contract negotiations ‘inadequate’

Virgin Hotels Culinary Union Strike

Brian Ramos

Culinary Workers Union 226 and Bartenders Union Local 165 picket outside of Virgin Hotels Las Vegas . The Culinary Union called for a 48-hour strike at Virgin Hotel, the first time in over 22 years beginning Friday, May 10th at 5:00 am - Sunday, May 12th at 4:59 am in Las Vegas, Nevada.

Virgin Hotels Las Vegas’ latest contract proposal for employees is “unacceptable for workers,” Culinary Union Secretary-Treasurer Ted Pappageorge said Thursday.

The off-Strip resort announced Wednesday that it had sent a “last, best and final” offer to the union, after five months of unsuccessful negotiations and nearly a year since workers’ contracts initially expired. Though the proposal includes wage increases where previously there were “zero,” Pappageorge said, it’s still “woefully inadequate.”

“Some companies come to Las Vegas with the idea that they’re going to build their massive resorts on the backs of workers, and it doesn’t work that way in Vegas,” he said. “When you come to Vegas, you’ve got to bring money to invest in bricks and mortar, and you’ve got to bring money to invest in workers. And unfortunately, Virgin is not there.”

The property’s offer letter this week is only the latest movement in its dance with the union. The property filed a complaint with the National Labor Relations Board this month accusing the union of engaging in unlawful bargaining tactics, threatening employees who did not give it their support and more.

Around the same time, the union embarked on its first official strike in more than 20 years. Hundreds of people picketed outside and caused a work stoppage at the property for 48 hours, citing as their primary motivation a total lack of proposed wage increases in contract negotiations.

“Everything is so expensive right now,” Isabel Gonzalez, a Virgin guest-room attendant of almost 15 years, told members of the media Thursday. “It’s hard for me to make money to provide for my family, to pay my rent — everything is up.”

Gridlock on wage increases

In Virgin’s final offer letter Tuesday to the Culinary and Bartenders unions, which it shared with members of the media, officials acknowledge that the bargaining unit wants its economic demands met, but the property “simply cannot afford it.”

Despite that, the union has “refused to make any alternative proposal,” and its opening wage and benefits demands have remained unchanged since February, reads the letter, signed by Kate Hay, chief human resources officer at JC Hospitality, which owns Virgin.

Pappageorge contradicted Virgin’s claim that it cannot afford wage increase proposals by the union during a media availability Thursday, saying the company is funded by Wall Street banks and hedge funds and therefore has “deep pockets.”

The opening wage proposal the union made to the property was the same one it made to around two dozen other independent Las Vegas properties, as well as hospitality powerhouses such as MGM Resorts International and Caesars Entertainment before that, he said. Virgin is the last resort still in ongoing negotiations with the union.

The citywide standard for economic agreements that has been won for over 50,000 workers is a 10% increase in wages and benefits in the first year of a new contract and a total of 32% in raises during its life, said Bethany Khan, the union’s spokesperson. By the end of the new five-year contract, the average union member will earn $37 an hour, she said.

“At the end of the day, it’s up to the company,” Pappageorge said. “The idea that we’re asking this company to step up to the same standard that the Rio and the Sahara and the (Strat) have stepped up to months ago — it’s not a high bar.”

The letter from Virgin informs the union that the property has modified its wage and benefit proposal for a fourth time, to guarantee benefit contributions for the first three years of the five-year contract agreement — which would act as a “runway” to give the property time to stabilize its business.

For the last two years of the agreement — fall 2026 to fall 2028 — Virgin officials said in the letter that they would want to provide “team members with the certainty that there will be a wage increase.” They propose in the letter a definitive $1-an-hour package increase for each of those years.

Other offers it makes include workload reductions for guest-room attendants, an increase in gratuity calculated off menu retail prices on all complimented food and beverages, and more.

The offer also acknowledges “strike” issues for the union, such as a no-strike clause and safety.

The $1 increase is a “package” increase, Pappageorge said, meaning it would be divided between wages and benefits. The result would be an increase of 51 cents for benefits and only 49 cents left over for the wage increase, he alleged.

To compare, he said, workers at the Strat will make $1.70 more in the last year of their contract.

“These are not second-class workers,” Pappageorge said. “And we’re not going to allow them to be treated second-class by any company in Las Vegas.”

Good faith, bad faith

While Virgin expressed appreciation in the letter for the proposals that Culinary has agreed to, it alleged there were revised proposals to which the organization failed to respond entirely.

And, although Culinary said at the negotiating table May 14 that the two entities should schedule a virtual meeting to finalize subcommittee proposals, Virgin officials said in the letter that they have attempted to set up such a meeting twice, with no response from the union.

They have also requested to resume negotiations twice, and not received a response from the union, Virgin alleged in the letter.

Pappageorge said the company has taken a “strange position” by publicly accusing the union of not being willing to negotiate.

He noted that the union has sent potential bargaining dates to the property, though it cannot abide by Virgin’s suggestion in its letter for June 7 because workers are too busy to come to the negotiating table on weekend days. The company has to agree to a date that is most convenient for workers, he said.

“We’ve … never agreed that they don’t have the ability to pay,” Pappageorge said. “We think they do. And there’s certainly opportunities to bargain when the company is bargaining in good faith and reasonable, but we just haven’t seen that yet.”

The letter, which also lists officials like Virgin Hotels Las Vegas President Cliff Atkinson, alleges that the union has made “take it or leave it” demands that are not “solution-oriented” and make an agreement impossible.

“We believe that your continued insistence that we negotiate against ourselves is unfair,” the letter reads. “Your failure to bargain in good faith is harming our team members. We want to bring negotiations to a close so that everyone at Virgin Hotels Las Vegas — management and all team members — can focus on our business and our guests.”

What’s next?

Though officials in the letter from Virgin ask that the union “give our team members a voice in this process and present our proposal for consideration and a vote,” Pappageorge said Thursday that the proposal will not go to a vote.

It will go to the negotiating committee for analysis, he said, as the union awaits a return to bargaining.

He has never seen a property share its offer letter with the press like Virgin did this week, added Pappageorge, who called the tactic “unusual” and repeatedly decried it as a signal of the property’s unwillingness to get serious about union demands.

“It’s designed as a publicity stunt,” he said. “It’s not serious bargaining. And it’s disrespectful to the negotiating committee and the workers.”

Lee McNamara, a lead cook at Virgin, called Virgin’s latest proposal unacceptable, and emphasized that he hopes they’ll all return to the table soon.

“We are the workers,” McNamara said Thursday. “We’re the ones that in the end, get it done. And they need to accept that. … The situation is unfortunate, but I really hope that the workers and the union and the company can come to a resolution and get this done because it needs to be done.”

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