Wynn backs tip pool

Casino magnate Steve Wynn called me Friday to lodge his objections to my column on the tip-pooling policy he implemented at his eponymous hotel in 2006.

Wynn unilaterally decided that year to include what are called “casino team leads,” in a tipping pool maintained by card dealers. Tips augment a dealer’s salary considerably, and although “casino team leads” make more in base salary, a dealer could easily make more when tips are added.

Now, Assemblyman Joe Hogan, D-Las Vegas, has a bill that would make employer-mandated tip pools like Wynn’s illegal, although it would allow employees to voluntarily pool their tips if they wish.

Wynn’s decision was controversial at the time — dealers voted overwhelmingly to form a union as a result of being forced to share tips with the team leads. Even a personal apology from Wynn didn’t change their minds.

That’s the first thing Wynn thought was wrong about my column: He said he apologized not for the tip pooling policy itself, but for the way it was implemented. Wynn said in hindsight he should have made the rule when he first opened his casino, so that workers would have been aware from the start they would be forced to share tips. He apologized for suddenly changing the policy, he said, but stands by the idea.

Fair enough, although I wasn’t the only person to misinterpret his remarks. A union organizer who learned of Wynn’s remarks at the time boldly predicted the tip pooling policy would be reversed after the union vote. But he was wrong.

That brings us to a second point — which I included in my column — that Wynn said wasn’t stressed enough: After four years of negotiations, the newly unionized dealers finally accepted tip pooling with casino team leads as part of their contract. Wynn (who said he personally conducted negotiations with the union) said he didn’t want to budge from the policy, because he felt it was fair. Ultimately, dealers agreed.

It’s not clear legally how Hogan’s bill — if it becomes law — would affect the 10-year dealers contract at Wynn, if at all. But, Wynn asked, if dealers agreed to it in contract negotiations, doesn’t that make the tip pool voluntary?

Again, fair enough. But there are a few dealers who are fighting the tip pooling policy in court, and they’ve persuaded District Court Judge Ken Cory that Wynn’s policy violates existing state law. (Cory’s ruling overturns the decision of the state’s Labor Commissioner, who found Wynn’s policy to be legal.)

And although Cory found that Wynn had benefitted from his tip-pooling policy — he was able to avoid having to pay his casino team leads even more because their salaries were being supplemented with shared gratuities — Wynn adamantly denied that allegation. He said he did augment team lead pay, at a cost to him of $7 million.

“I was not exploiting my workers to save money,” he insisted.

Although Wynn has persuaded me to visit every casino he’s ever built in Las Vegas, he didn’t convince me of the merits of his tip pooling plan. I still maintain state law – current state law — bans the practice, and for good reason. Tips are essentially gifts, given to workers, and should only be shared by those workers with their fellows voluntarily. Management of a casino or restaurant can oversee such a program, but shouldn’t force it on employees, even if they’re told those are the rules from the start.

Then again, Wynn’s dealers had a choice when they negotiated their contract: They could have gone on strike to protest the policy. Instead, most chose to accept it. The policy will only change if the Nevada Supreme Court upholds Cory’s ruling, or if a new contract is negotiated.

In the meantime, tip pooling continues at Wynn’s casinos.

Steve Sebelius is a Review-Journal political columnist and author of the blog SlashPolitics.com. Follow him on Twitter (@SteveSebelius) or reach him at (702) 387-5276 or ssebelius@reviewjournal.com.