Recently Forbes Magazine released its list for 2021 of the best employers in every state. In New Jersey The Hard Rock Casino and Hotel in Atlantic City, a wholly-owned subsidiary of the Seminole Indian Tribe based in Florida, achieved the number 1 spot as the best, most employee friendly place to work for. All profits from the Hard Rock Hotel are disbursed either as dividends to each member of the Seminole Tribe, or otherwise spent on health care, education and welfare programs which benefit the most needy members of the tribe. In the same survey Hard Rock International was given the number 2 spot out of 100 companies in its home state Florida. In New Jersey 90 employers with a minimum size 500 employees were ranked. Employees at each company completed a survey assessing a number of variables that contribute to worker satisfaction. These variables include such factors as pay and benefits, diversity of workforce, opportunities for advancement and education, and worker participation in management decisions. Hard Rock, owned by the Seminole Indian Tribe, was rated the number one employer to work for in New Jersey.
It is probably not coincidence that New Jersey’s number 1 employer based on employee satisfaction is owned by a collective, community group of Seminole Tribe members which profits are distributed among members of the tribe, as well as social welfare programs which benefit all tribal members, rather than a handful of Wall Street vulture capitalists picking at the bones of a dead business carcass. However, before the Hard Rock, there were several casino/hotel companies which occupied the property and which were exploited for the benefit of predatory investors. For thirty years the location was a source of financial advantages which benefited a few capitalists at the expense of many, mostly workers. The story begins with the very familiar, and universally loathed, self-promoting shyster Donald Trump. In the late 1980s Trump, who already developed and managed two other casino/hotels in Atlantic City, conceived and began construction on a third casino/hotel that would dwarf anything else in Atlantic City or Las Vegas. The most expensive casino/hotel ever built up until that time, which Trump declared to be his Taj Mahal, and which would cost over one billion dollars, a colossal sum even by today’s standards. Financing for construction would come from the sale of “junk bonds” at exorbitant interest rates to gullible investors.
The Taj Mahal could not have opened at a worse time. The $1.2 billion monument to Trump’s ego began operating after the collapse of the stock market and at the height of the financial calamity known as the Reagan/Bush Recession. Real estate prices fell drastically in the Northeast and Mid-Atlantic region of the country between the late 1980s and early 1990s. Casino and hotel revenue also fell dramatically especially in Atlantic City which experienced an oversaturated market with Trump owning three of the biggest and most costly casino/hotels in the city. The decline of revenue from casino/hotel operations was insufficient to pay the high interest rates on the junk bond debt incurred during construction.
When faced with similar situations Trump did what he always does and put the Taj into bankruptcy so he could stiff his investors, creditors and workers with massive layoffs and pay cuts. To take advantage of the bankruptcy Trump put together a new group of investors and bought the Taj assets at pennies on the dollar. While Trump and his new investor group benefited from the subsequent economic recovery and expansion in the 1990s, the original creditors and other investors lost considerable equity while casino/hotel employees continued to
suffer from depressed wages, reduced benefits and job insecurity. During this time it was reported that according to federal investigators tracking organized crime in New York City the Taj became the favorite casino hangout for Russian mobsters. A US Senate Subcommittee also linked the Trump Organization, and the Taj specifically, to Asian organized crime syndicates. A known associate of a Hong Kong based criminal gang was working as the Vice-President of foreign marketing at the Taj since 2000. The US Treasury Department also cited the Taj for violating regulations related to reports of money laundering.
When the stock market and economy collapsed during the subsequent Great Recession, the Taj experienced another serious decline in gaming and hotel revenues. The investor group which owned the Taj at the time, Trump Entertainment Resorts, eventually declared bankruptcy in 2014. The goal was to regain profitability by extracting more concessions on pay and benefits from the employees. In 2016 UNITE HERE, the union representing Taj employees, agreed to concessions to keep the facility open but the new owner, Wall Street vulture capitalist Carl Icahn, closed the Taj anyway and planned to reopen it as a non-union company. With support from other labor unions, local and state political leaders, as well as popular opinion and threats of a boycott, the UNITE HERE employee’s union was able to exert considerable pressure on Icahn who chose instead to sell the Taj in 2017 at a rock bottom price to Hard Rock International, a company wholly owned by the Seminole Tribe based in Florida. The Hard Rock company announced that it would spend $300 million to purchase and renovate the property. UNITE HERE welcomed the purchase with the new owners pledging to abide by prevailing standards for wages and benefits, as well as new opportunities for employees to have more
input into running the business. In June, 2018, the Taj reopened as the Hard Rock Casino and Hotel. Despite the pandemic the Hard Rock became profitable and recently announced a plan to invest an additional $20 million in improvements and renovations.
In conclusion it is doubtlessly not by chance that Forbes named Hard Rock the number one employer in New Jersey and number two employer in Florida for employee satisfaction. This would not have been possible in New Jersey without support from the local union formed by the merger in 2004 of UNITE (Union of Needletrades, Industrial, and Textile Employees) and HERE (Hotel Employees and Restaurant Employees), which played an indispensable role in stopping the conversion of the Taj to a nonunion facility by predatory, vulture capitalist Carl Icahn. The experience with the Trump/Icahn Taj Mahal and subsequent Hard Rock ownership clearly shows that responsible business management of a community owned company, in this case the Seminole Tribe of Florida, can not only lead to greater employee satisfaction but also maintain a
reasonable level of profitability as well
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