Judge rejects Wynn tip-pooling policy; company to appeal
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Thursday
10 November 2011
11:30 a.m.
Updated
10 Nov. 2011 1:02 p.m.
Steve Wynn’s revolutionary policy of requiring hundreds of card dealers to share tips with supervisors does not comply with Nevada law, a state judge has ruled.
Clark County District Court Judge Kenneth Cory this week ruled that Michael Tanchek, at the time Nevada’s labor commissioner, erred last year when he found the Wynn tip-pooling policy doesn’t violate state law.
An attorney for Wynn Resorts Ltd. on Thursday said the company would appeal Cory’s order — setting up a showdown on the issue at the Nevada Supreme Court, where the parties have predicted the case would eventually end up.
“The Wynn disagrees with the order and intends to appeal the District Court’s rulings to uphold the more appropriate rulings and reasoning of the Labor Commissioner,” said Las Vegas attorney Gregory Kamer.
Ruling Tuesday in a lawsuit filed by dealers challenging Tanchek’s ruling, Cory wrote that Wynn casino supervisors called boxmen and “Casino Service Team Leads,” formerly floor supervisors and pit managers, can’t share in dealers’ tips.
Leon Greenberg, an attorney for dealers challenging the tip-sharing policy, said that if Cory’s ruling is upheld it will allow him to demand the return of some $30 million he believes has been wrongly taken from the dealers since 2006. Cory’s ruling will allow the dealers to pursue their claims as a class action — a development that protects individual workers from retaliation should they complain about the policy, Greenberg said.
Tip sharing is common among workers in the same job classification, dealers or waitresses for instance. It’s uncommon — but not unheard of — to have supervisors share in these tips.
While tip sharing between dealers and supervisors has been a longtime practice in at least two smaller casinos in Nevada, it’s implementation by Steve Wynn in 2006 at Wynn Las Vegas and later at Encore was a first for the Las Vegas Strip. Wynn said he wanted to equalize the incomes of dealers and their supervisors to recruit more supervisors. On the Strip, dealers typically make more than their bosses because of hefty tips.
Dealers complained the Wynn policy had deprived them of money they earned and had reduced their incomes.
The key legal question was whether Wynn Las Vegas and Encore received an unauthorized “direct benefit” by diverting tips from the dealers to the supervisors.
Attorneys for Wynn insisted during an August hearing that the company received no direct benefit as it was simply redistributing money among the casino staff and that the dealers’ supervisors were entitled to share in tips as they have substantial customer satisfaction duties.
Wynn’s attorney, Kamer, also argued a minority of dealers are behind the legal challenge and the vast majority of the company’s approximately 1,000 dealers want nothing to do with the dispute.
Kamer further had urged Cory not to legislate from the bench, pointing out the Nevada Legislature has had plenty of opportunities to explicitly outlaw such tip-sharing arrangements but has not done so.
Attorneys for the dealers — who say some $5 million per year is being diverted from dealers to supervisors — insisted Wynn receives a direct benefit since the diverted tip dollars are dollars that Wynn as a corporation doesn’t have to come up with to help pay for the supervisors’ raises.
The bottom line is that the policy boosts Wynn’s profit at the expense of the dealers, attorneys for the dealers complained.
Cory, in Tuesday’s ruling, sided with the dealers in the legal dispute, and he cited a lack of support for Wynn’s position in Nevada Supreme Court case law.
“Quite simply, the Nevada Supreme Court has never allowed a mandatory tip-pooling policy that extends beyond the dealer-only pool,” Cory wrote in his ruling.
“This court is unprepared to say that the tip-pool in the instance case, one that allows boxpersons and Casino Service Team Leads (CSTL) to share in the tip pool with dealers, is one that the Supreme Court anticipated” in a previous case, Cory wrote in his ruling. “To so hold in the face of the demonstrable evidence of the direct economic benefit to Wynn would be to eviscerate the meaning of ‘direct benefit to an employer.’ Therefore, Wynn is prohibited from including boxmen and CSTLs in the tip pooling agreement.”
The Wynn policy was aimed at boosting the pay of casino supervisors from about $60,000-$65,000 to $85,000-$90,000, or about what the dealers were making before the change, attorneys have said.
Wynn had provided the supervisors with a $5,000 raise, with the rest of their raise coming from the dealers’ tip pool, dealers’ attorney Greenberg said during the August ruling.
On Thursday, Greenberg said Cory’s ruling was “direct and straight-forward.”
“He’s saying it’s OK to have tip sharing — but with people in different job classifications it’s not appropriate,” Greenberg said.
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Discussion 6 comments
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I'm not saying the policy is wrong, but, if you don't think that Wynn doesn't take those tips into account when they compare salary and bonus ranges to like supervisory roles in other industries, your deluding yourself!!!
It was an easy target, to take away people's tips and not paying your Supervisors a living wage. What shame has Mr Wynn have? None!
By the time this lawsuit is settled, most will no longer be alive the fruits of their case.
"Wynn's attorney, Kamer, also argued a minority of dealers are behind the legal challenge and the vast majority of the company's approximately 1,000 dealers want nothing to do with the dispute."
As Margaret Mead said :"Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has."
Just because the majority are willing to sit ideally by and let this injustice occur does not make it right.
Steve Wynn has certainly done a lot for this town. So for that he deserves credit, but this was the lowest blow a scum bag like him could do. Instead of paying his casino pit bosses what they deserved he dips into the little guys tips, at the same time taking more than his share for himself. Thats wrong. If the tip is handed to a pit boss fine. But I can promise you when I gamble and I leave a toke its for the dealer and not the stiff guy in the suit.
The Supreme Court will probably support Wynn. It is his casino and he can set the rules as he likes. The tip sharing may be unfair but it does not violate any laws.
1. This tip pooling was used all over the operations -- far beyond the casino floor.
2. Since this was a one-way sharing in practice (i.e., hourly employees had to pool and share with supervisors, but no one actually made sure that supervisors' tips were pooled and shared with employees) Mr. Wynn has quite a lot of money at stake and no way to account for it.
Floors and Pits: now it's your turn to step up and organize. Make wynn pay you the money you deserve.
Stealing from the dealers was just plain evil.
Justice has finally been served.Common sense in reading NRS regarding dealer tips was all it took.My 10year old grandson could read it and understand it.I don't think clerks and staffers at the city,county or state level would think it was right to have to give their supervisors part of their salaries so that the supervisors could earn more money.Think about it.To all my Wynn brother and sister dealers,congratulations.You started a snowball rolling downhill.It's really picking up speed now thanks to you.VM
To NVFisherman: It does violate the law. It is clearly stated in NRS that an employer can not take tips to redistribute to other employees.Read it and learn .
Baccarat3 you keep insisting it violates the law, what your referring to does not apply to this case and cannot be used as case law. In fact there is no case law on this, therefore the supreme court will set precedent. Under your theory, waiters would not be required to tip out bussers, bartenders would not have to tip out barbacks etc. When in fact they do it everynight. It's alot more complex and no your 10 year old cannot comprehend this legal wrangling. The issue that will be decided is this; are pit bosses performing the same job function and can you prove Wynn is using the tips to subsidize their salaries (he is of course). Btw i hate Wynn, but he will probably prevail
It hard for me to beleive what I am reading. Any judge with ethics will not even entertain this appeal.
If they find a judge who rules in the corp's favor the judicial system has a real problem.
It's seems like the deomocratic system is broken I am glad I am at the age I am today.
I lived in the good years when soldiers came home from the war and did not want to fight any more. They started families and homelife was simple. It consisted of a wife & children and home with a white picket fence and a job and a car. Entertainment was time spent with friends.
No plastic money. you only spent what your earned the hard way.
It was yours to keep or save
Vegastruth- You are wrong when you compare the tip sharing between dealers and floor supervisors to that between waiters, waitresses , barbacks ect.. Each and everyone of those people choose " themselves" how much to tip at the end of the shift. They also took those jobs knowing the tip policies that were in place. The dealers were" forced" into the tip pooling almost two years after starting at Wynn.
Clearly the floor supervision provides a service to both the customers and the dealers with their presence on the floor, and as such, should be included in the tip pool.
.
What I can't understand, is why aren't dealers up in arms about the numerous other dealers with zero personality that generate a fraction of the tips, yet receive a full share of the tip pool?
Great example of Socialism Steve.
What a phony, Communist loving POS!!!!
What can one expect from an Industry Built on Greed?
They expect the Dealers to work for Wages that can't meet a person's Financial Needs, where they therefore have to depend on the generousity of the patrons to make up for it, and then they are expected to share that generousity with their Supervisors, who in most cases, just stand there, and try to look important, or engage in non work related conversations with the Managers!
I say they should give the tips to the "Real Workers" which are the Dealers!
If the Casino wants to attract more people to be Supervisors, then they should pay them accordingly, and NOT expect the Lower Paid Dealers to make up for the Casino being too cheap!
I am so glad I am no longer in the "Industry" as I have seen too many people waste their Talents, at a Casino.
I was one of those people, for a total of 13 years.
It was like being a Hamster on a Wheel.
They can run and run, as fast as they can, and still get nowhere!
I now own my own Business, and am no longer treated like a number, or someone who is married to the Casino, and not allowed to have a life!
The only reason 1000 dealers support the policy is because they want to keep their $70000 a year jobs. If it goes to a class action suit you might have 100 that would support the Wynn's policy, and they would be the "Juice Kids" who can't deal and don't support to the tip pool in any meaningful way...
When i was working as a lifeguard in the seventies , the contractor who ran the pool concession, would dole out $1/hour of tips to the employees. He would keep the rest. Good deal for him, even if it wasn't legal. Employers can't be trusted to do the right thing.
Lola72- i totally agree they where forced too accept it and i see your point. Would not say im wrong comparing it to bussers and barbacks. This is in fact the legal argument the court will have too address. Its complex, that was my argument in context. The bussers,bartenders,waiters are by no means independent contractors. Whoever they work for could dictate or change their said "agreement" at any time, just never been done. This tip sharing is both genius (saving co money) and evil. Honestlty I root for employees over wynn
First of all? Wynn resorts IS in violation of NRS 608.160. Here is the law in its current form:
"NRS 608.160 Taking or making deduction on account of tips or gratuities unlawful; employees may divide tips or gratuities among themselves.
1. It is unlawful for any person to:
(a) Take all or part of any tips or gratuities bestowed upon the employees of that person.
(b) Apply as a credit toward the payment of the statutory minimum hourly wage established by any law of this State any tips or gratuities bestowed upon the employees of that person.
2. Nothing contained in this section shall be construed to prevent such employees from entering into an agreement to divide such tips or gratuities among themselves."
It is simple, and to-the-point. For Steve Wynn to think he can violate this law on the basis of his wealth, and position, in Nevada is unethical. Just because one thinks what they're doing is legal, does not make it right. I wonder, could Steve Wynn live, or even SURIVIVE, on the wages he pays his dealers?
Whatever happens, it will be interesting to see what the IRS does. Now that the dealers' lawyer is declaring how much the dealers actually make when tips are factored in, is everyone declaring the actual amount on their income tax statements?
The dealers, I dont want to give a tip to these stone faced manikens. The tip policy should be abolished (pay them well upfront.) If the Supreme Court agrees with the District Court and they invariably do since they served in that capacity, the Casino will end up paying the $30 Million, since the supervisors wont.. This coudl be small change for the Casino, but I reckon, it will a big set back for Wynn.
I don't get all of this community adoration for Wynn. He supports communist China with his mega resort there. He has come out and endorsed more casinos in Miami. All this man thinks about is himself and lining his own personal pockets. He doesn't pay his employees any extraordinary salaries, except maybe the 1% at the top, like himself. He is NOT good for Las Vegas, he is only good for himself.
He employs communist Chinese in Macau, pays off the Chinese mob that brings in the tourists, and who knows how much goes to the the Chinese government! WTF -- some patriot! Seeing him lose this battle on THIS DAY, to honor veterans is a small taste of sweetness. Uh, ever been in the service, Steve? Ever think of using your real name? Hell, even your face is phony...how many facelifts have you had?? You are beginning to resemble Bruce Jenner.
Do you see him offering any solutions to the woes in this country, this state, this county, or this city that has made him the billionaire he is? No, all he can do is bash Obama at every turn and blame everyone but people like himself. Why not put his money where his mouth is? And put his loyalties back in Nevada, let alone the USA.
the IRS already knows how much the dealers make . Only poker dealers don't claim all their tokes . they don't have to pool their tips . 21 and dice dealers have no choice whether to pool tips or not to .