Harrah's Entertainment Sets Tentative Five-Year Union Contract; Local 54 Union Members Expected to End Atlantic City Walkout
LAS VEGAS, Harrah's Entertainment, Inc. (NYSE: HET - News) reached a tentative five-year agreement providing wage and benefit increases averaging about 4.2 percent annually to members of the UNITE-HERE Local 54 union in Atlantic City, setting the stage for the end of a month-long walkout.
The proposed contract is not expected to have a material impact on the financial results of Harrah's two Atlantic City properties over the next five years. October 2004 revenues were approximately 8 percent lower at Harrah's Atlantic City and 3.5 percent lower at the Showboat Atlantic City than in October 2003, as visitor volume declined during the walkout.
"The strike has been difficult for everyone involved," said Harrah's Entertainment President and Chief Executive Officer Gary Loveman. "However, I believe this new contract and the past 20 years of mutually beneficial relationships better define our long-term relations with the union and its members far better than did the last month.
"I'm pleased that we were able to reach an agreement with union leaders to provide a long-term contract that offers good benefits and longer-term job security to its members," Loveman said. "We and other Atlantic City casino operators also benefit from a contract that provides for the five years of labor peace we sought as an industry.
"I'm optimistic we can quickly restore our traditional strong relationships with the union members who are so important to the success of our Atlantic City properties," Loveman said. "We look forward to welcoming them back to the Harrah's family and working together to provide our customers with the superior service and casino-entertainment experience they have come to expect from Harrah's Atlantic City and the Showboat.
"I want to give special thanks to the non-striking employees and volunteers who worked tirelessly to keep our properties operating under trying circumstances," he said. "I appreciate the understanding of the customers who patronized our properties over the past month. And I'm grateful to the Atlantic City community for its patience during the dispute."
Various subsidiaries of Harrah's Entertainment, Inc. own or manage 28 casinos in the United States, primarily under the Harrah's and Horseshoe brand names. Founded 67 years ago, Harrah's Entertainment is focused on building loyalty and value with its valued customers through a unique combination of great service, excellent products, unsurpassed distribution, operational excellence and technology leadership.