REPORT: Icahn’s Costly Vendetta: The Effects of the Labor Dispute at the Taj Mahal

REPORTBANNER2Read the Full Report: Effects of Labor Dispute at Taj Mahal

Icahn’s Costly Vendetta: The Effects of the Labor Dispute at the Taj Mahal

Executive Summary

In October 2014, Carl Icahn, the current owner of the Trump Taj Mahal and the Tropicana, did something at the Trump Taj Mahal that no other casino employer in the modern history of Atlantic City had done—he eliminated health insurance and other benefits for around 1,000 cooks, housekeepers, bartenders, cocktail servers, and other service workers.

Icahn’s unprecedented actions provoked a labor dispute between the casino workers and the billionaire.

This report finds that:

  • In the first quarter of the labor dispute, hotel occupancy DROPPED by 12 percentage points even as the industry INCREASED occupancy by 5 percentage points. The drop in occupancy continued through the present quarter.
  • One way to measure the Trump Taj Mahal’s performance relative to the rest of the industry is by comparing RevPAR (Revenue Per Available Room). In the first half of 2014, the Trump Taj Mahal had RevPAR of almost 60% of the rest of the industry average. In the final three months of 2014, the wheels came off as the Trump Taj Mahal’s RevPAR fell to just 40% of the rest of the industry average, a point from which it has not recovered.
  • If Icahn had not picked a fight with the casino workers, and the Trump Taj Mahal’s RevPAR had remained at 60% of the industry average, it would have translated to about an additional $20 million EACH QUARTER in revenue. In total, between October 2014 and the end of June 2016, the Taj Mahal lost out on over $150 million in revenue.
  • If instead of fighting his employees, Icahn had reinvested in the casino and, starting in the third quarter of 2015, Taj had been able to INCREASE its RevPAR relative to the rest of the industry to75%, it would have meant an additional $65 million in revenue for the Taj Mahal or a total of $215 million.
  • Icahn has chosen to wage a 22-month battle with 1,000 employees that has cost the Taj Mahal an estimated $150 million when the conflict could have been resolved for a few million dollars a year. It is fair to ask whether this is a business decision or if one of the richest men in the world has some axe to grind with employees that make an average of less than $12 per hour.

Read the FULL REPORT here. 

Press Release: New Way for Public to Support Striking Trump Taj Mahal Workers

Contact: Diana Hussein, dhussein@unitehere.org, 313-460-3119

Workers have been struggling for 22 months under Icahn’s Reign of Terror at Trump Taj Mahal

GoFundMe Page

(Atlantic City, NJ) — Union members at the Trump Taj Mahal announced the creation of a GoFundMe campaign for the Local 54 Hardship Fund. The funds will be used to provide assistance to workers hit hard by Carl Icahn’s destruction of good jobs at the casino.

“Workers have been struggling under Carl Icahn’s reign of terror at the Trump Taj Mahal for over 22 months. Their benefits have been stripped away, and now, Icahn has said that he will close the place in 2 months. These women and men have been on strike for over a month to defend middle class jobs. People ask all the time how they can support the strikers; this GoFundMe campaign is one way to do that,” said Donna Decaprio, Financial Secretary-Treasurer of UNITE HERE Local 54.

In October 2014, Donald Trump supporter, Carl Icahn, used the bankruptcy process to strip 1,000 workers of their health insurance, pensions, paid lunch breaks and increase the workload for some. On average, the workers total compensation has been cut by more than 30%. As a consequence of Icahn’s cuts, about one-third have no health insurance while another 50% rely on some form taxpayer subsidized insurance. A portion of the 1,000 workers rely on other government programs, like food stamps.

On July 1, 2016, Trump Taj Mahal workers took a stand against Carl Icahn’s policies and went on strike for the same contract that other Atlantic City casino workers have.

Icahn was intimately involved in the decision to strip workers of their benefits. According to documents filed with the bankruptcy court, Icahn and the then-management of the Trump Taj Mahal began working together on a strategy to reject Local 54 contract over a month before the company filed for bankruptcy.

“Shortly after I was diagnosed with breast cancer, Carl Icahn took my healthcare away.  The Local 54 Hardship Committee helped pay my medical bills.  I don’t know what I would have done without their help,” said Patricia Mazur, a 26-year cocktail server at the Trump Taj Mahal.

The Unite Here Local 54 Hardship Fund assists strikers who are experiencing financial difficulties with paying rent, mortgage, utility payments, medical bills and other essential expenses.

Donations will assist strikers who are experiencing financial difficulties. Donations from employers are not permitted and donations are not tax deductible.  All donations will be handled in accordance with applicable state and federal laws.

Link to GoFundMe Campaign

Trump Taj Mahal Striker Valerie McMorris On July Gaming Revenue Report

“The 22-month labor dispute at the Trump Taj Mahal has clearly taken its toll. This property is going the wrong way in an industry that’s doing better. The Taj has been impacted financially because Mr. Icahn won’t invest in what they’ve always told us was their number one asset – us.”

-Valerie McMorris, Cocktail Server at Trump Taj Mahal, 26 years. 

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New Statement from UNITE HERE Local 54 President Bob McDevitt on Trump Taj Mahal (8-4-2016)

Carl Icahn has taken hundreds of millions of dollars out of Atlantic City over the past several years. Recently, he has made a public promise to put $100 million into the Trump Taj Mahal. He told the workers they were the most important asset of the property. Now, rather than negotiate with those same workers, he has decided he would rather close down. We have not had an offer from Icahn since the evening of June 30, when workers rejected that proposal and voted to strike. It has been nothing but the usual my way or the highway from Carl Icahn. That’s not trying to reach an agreement; that’s punishing working people for standing up to injustice.




Statement from UNITE HERE Local 54 President Bob McDevitt on Trump Taj Mahal




For Immediate Release
Contact: Diana Hussein 313-460-3119 dhussein@unitehere.org;
Morgan Rubin, 646-517-1813, morgan.rubin@berlinrosen.com

Statement from Bob McDevitt, President of Unite Here Local 54, on Trump Taj Mahal

“How petty. I would never have thought Carl Icahn was so one-dimensional. The great deal-maker would rather burn the Trump Taj Mahal down just so he can control the ashes. For a few million bucks he could have had labor peace and a content workforce, but instead he’d rather slam the door shut on these long-term workers just to punish them and attempt to break their strike. There was no element of trying to reach an agreement here on Icahn’s part; it was always “my way or the highway” from the beginning with Icahn. It is the epitome of the playground bully, who picks up his ball and announces he is going home because nobody else would do it his way. It is truly a shame that such an unscrupulous person has control of billions of dollars.

These workers are exercising their fundamentally American right to stand up for themselves in the face of injustice. Carl Icahn took it personally. This is clearly not a business decision – a few million dollars is a drop in the bucket compared to the money he publicly promised he would put into the Trump Taj Mahal. It’s a classic take-the-money-and-run: Icahn takes hundreds of millions of dollars out of Atlantic City and then announces he is closing up shop. This titan of Wall Street is utterly incapable of making a decision unless it is mean-spirited and benefitting him alone, and he is plagued with indecisiveness when things don’t go his way.

Twenty-two months ago Carl Icahn took away these workers’ healthcare, retirement and dignity. We’ve all been playing Icahn’s game since then. In the end he’ll have to live with what he’s done to working people in Atlantic City, and have to justify whatever myopic prism he is using today to evaluate how, once again, his decision making process makes sense to nobody but himself. This is now the third casino closure Carl Icahn has orchestrated in Atlantic City. The Boardwalk is littered with empty monuments to his greed. Icahn has lost the capacity for self-reflection, the ability to realize that when you are completely alone in your position it just might mean you are wrong.

In the end, these workers stood up for what every other casino worker doing their job in this town has, and what every other casino worker here has had since gaming was introduced to Atlantic City over three decades ago. And, as with playground bullies, we also know that he’ll be back another day, demanding something else based upon the whims of the moment. Thank God there are working people who will stand up to him.

If this is the guy Donald Trump wants to be Treasury Secretary of the United States, then this country is doomed.”

ABOUT UNITE HERE

UNITE HERE represents workers throughout the United States and Canada who work in the hotel, gaming, food, service, airport, textile, manufacturing, distribution, laundry and transportation industries.  Learn more at www.unitehere.org.

 

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Press Advisory: Senate President Sweeney, Assembly Speaker Prieto to Announce Support for Extending Unemployment Benefits to Striking Trump Taj Mahal Workers

NJ AFL-CIO President Wowkanech, Striking Taj Mahal Workers Slam Billionaire Carl Icahn for Refusing to Negotiate Fair Contract at Trump Taj Mahal

Contact: Diana Hussein 313-460-3119 dhussein@unitehere.org
Morgan Rubin, 646-517-1813, morgan.rubin@berlinrosen.com

WHAT:  NJ Legislative Leaders, and over 100 striking workers will hold a press conference Monday to announce support for a bill to extend unemployment to striking worker

WHO: Senate President Stephen Sweeney, Assembly Speaker Vincent Prieto, NJ AFL-CIO President Charlie Wowkanech, and other elected officials will be joined by 100+ striking Trump Taj Mahal workers.

WHEN: Monday August, 1 2016 at 12:30 PM

WHERE: The steps of the NJ Statehouse, 125 W State St, Trenton, NJ 08608

WHY: One thousand cooks, housekeepers, bellmen, bartenders, cocktail servers, and other service workers from the Trump Taj Mahal have been on strike since July 1. The strike at the Trump Taj Mahal- a casino owned by billionaire Carl Icahn – follows on the heels of agreements set in place with the Tropicana and Caesars Entertainment, which owns Atlantic City’s Caesars, Harrah’s and Bally’s.

The legislation would allow striking workers to receive unemployment benefits beginning after 30 days on strike, ensuring that families aren’t penalized for standing up for their rights on the job.

BACKGROUND: Many workers at the Trump Taj Mahal, including those with years on the job, have seen only $.80 in total raises over the last twelve years. The cost of living in Atlantic City has risen over 25 percent in the same time period. Housekeepers, servers and other casino workers at the Taj Mahal earn an average of less than $12/ hour.

As the sole debtholder between 2010 and 2014, Icahn extracted $350 million from the property, driving it into bankruptcy and then swooping in to take control. He used the bankruptcy proceeding to strip Taj Mahal workers of health benefits and retirement security. Overall, he cut worker compensation in wages and benefits by 35%.

Without health benefits, half of workers at the Trump Taj Mahal rely on taxpayer subsidized health insurance. A third have no health insurance at all, putting them at risk of bankruptcy in the event of an illness and forcing taxpayers to pay for visits to the Emergency Room. Some of the workers rely on other public assistance programs, like food stamps.

PRESS RELEASE: Trump Taj Mahal Strikers Detail Effects of Trump and Icahn-omics to DNC Labor Caucus

For Immediate Release
Contact: Ben Begleiter, UNITE HERE Local 54, bbegleiter@unitehere.org, 203-668-6676

Trump Taj Mahal Strikers Detail Effects of Trump and Icahn-omics to DNC Labor Caucus

dncpic(Philadelphia, PA, NJ) – Over a dozen striking workers from the Trump Taj Mahal traveled to Philadelphia to address the DNC’s labor caucus to condemn Donald Trump ally and corporate raider, Carl Icahn.

“I’m here today, because Carl Icahn, the man Donald Trump thinks should be running the US economy has taken middle class jobs at the Trump Taj Mahal and turned them into poverty jobs. This isn’t right. It isn’t right that a billionaire can come in and strip of us what we’ve worked for, sacrificed for. We struck because we will not let billionaires like Carl Icahn or his friend Donald Trump dictate to us,” said Charles Baker, a 26-year cook at the Trump Taj Mahal.

Since July 1, about 1,000 cooks, bartenders, housekeepers, cocktail servers and other service workers have been on strike at the Trump Taj Mahal to reenter the middle-class after Icahn used the bankruptcy court to strip 1,000 workers of pay and benefits worth more than 1/3 of their total compensation. Many workers at the Trump Taj Mahal, including those with years on the job, have seen only $.80 per hour in total raises over the last twelve years. The cost of living in Atlantic City has risen over 25 percent in the same time period. Housekeepers, servers and other casino workers at the Taj Mahal earn an average of less than $12/ hour.

“When you have an employer, like Trump, running for President – there is no truer test of his character than how he treats his own employees. In Atlantic City, when his businesses went bankrupt, workers were left holding the bag—an empty bag. Trump left town with a suitcase full of money,” said Maria Elena Durazo, Vice Chair of Democratic National Committee and Chair of the DNC Labor Council. Durazo also serves as General Vice President of UNITE HERE, the union of hospitality and food service workers in the U.S. and Canada.

Durazo continued, “Today striking Trump Taj Mahal workers are taking a stand to save middle-class jobs. The Democratic Party stands with workers in Atlantic City and all workers striving for a better life for themselves and their families. We cannot allow Trump do to America what he’s done to Atlantic City.”

Both Donald Trump and Carl Icahn have taken millions from the Trump Taj Mahal for themselves while workers have been left holding the bag. As the sole debtholder between 2010 and 2014, Icahn extracted $350 million from the property, driving it into bankruptcy and then swooping in to take control. He used the bankruptcy proceeding to strip Taj Mahal workers of their retirement security and even basic benefits like healthcare. Overall, he cut total average worker compensation by 35%.

“These brave workers have been on strike since July 1 after a 20 month struggle with Donald Trump’s friend and allly and the guy he thinks should be in charge of the economy. We’ll do everything we can to support their struggle,” said Richard Trumka, President of the AFL-CIO.

Without health benefits, half of workers at the Trump Taj Mahal rely on taxpayer subsidized health insurance. A third have no health insurance at all, putting them at risk of bankruptcy in the event of an illness and forcing taxpayers to pay for visits to the Emergency Room. Some of the workers rely on other public assistance programs, like food stamps.

The strike in Atlantic City comes on the heels of agreements with four casinos.

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On Eve of DNC, Democratic Members of Congress Denounce Trump and Icahn-omics

FOR IMMEDIATE RELEASE – July 24, 2016
Contact: Ben Begleiter,  203-668-6676

Video of all speeches is available at https://unitehere.box.com/v/july242016

IMG_6217(Atlantic City, NJ) –Several members of Congress and a DNC vice-chair joined striking Trump Taj Mahal workers on the picket line in Atlantic City to condemn Donald Trump ally and corporate raider, Carl Icahn.

“I am proud to stand with striking Trump Taj Mahal workers in their struggle against Donald Trump’s would-be Treasury Secretary, Carl Icahn, for healthcare and a fair contract. My office will pursue Brokaw Act legislation in order to prioritize workers, communities and businesses over short term financial gains,” said Rep. Brendan Boyle (PA-13)

Since July 1, about 1,000 cooks, bartenders, housekeepers, cocktail servers and other service workers have been on strike at the Trump Taj Mahal to reenter the middle-class after Icahn used the bankruptcy court to strip 1,000 workers of pay and benefits worth more than 1/3 of their total compensation. Many workers at the Trump Taj Mahal, including those with years on the job, have seen only $.80 per hour in total raises over the last twelve years. The cost of living in Atlantic City has risen over 25 percent in the same time period. Housekeepers, servers and other casino workers at the Taj Mahal earn an average of less than $12/ hour.

“The American people are sick and tired of an economy that is too often rigged against them. When a hedge fund can carve up a business, putting Americans out of work and the company’s future at risk for their own short-term gain—then it’s time for a change. The Brokaw Act is a necessary response to these abuses against American workers, one that will bring much-needed transparency and oversight to activist hedge funds,” said Congressman Donald Payne Jr. (NJ-10)

Congressman Payne continued, “Carl Icahn, a good friend and adviser to Donald Trump, opposes the Brokaw Act—and it’s no surprise why. He is known for engaging in the abusive practices that this legislation would prevent. This man shouldn’t be in charge of a piggy bank, let alone our economic and financial systems.”

The Brokaw Act (SB 2720), which was introduced by Senator Baldwin (D-WI), would shorten the time period hedge funds have to make regulatory disclosures when they target a company, and prevent hedge funds from secretly banding together in “wolf-packs” to quietly accumulate shares in a company.

Both Donald Trump and Carl Icahn have taken millions from the Trump Taj Mahal for themselves while workers have been left holding the bag. As the sole debtholder between 2010 and 2014, Icahn extracted $350 million from the property, driving it into bankruptcy and then swooping in to take control. He used the bankruptcy proceeding to strip Taj Mahal workers of their retirement security and even basic benefits like healthcare. Overall, he cut total average worker compensation by 35%.

“We do what we have to to make sure our kids have a future. And then you have these businesses, these corporations, all they want to do is come in and take as much as they can and leave. They’re not building a legacy, you’re building a legacy. You’re a building a legacy of America for your children,” said Rep. Ruben Gallego (AZ-7).

Without health benefits, half of workers at the Trump Taj Mahal rely on taxpayer subsidized health insurance. A third have no health insurance at all, putting them at risk of bankruptcy in the event of an illness and forcing taxpayers to pay for visits to the Emergency Room. Some of the workers rely on other public assistance programs, like food stamps.

“I’ve worked down here in Atlantic City for 30 years in my career as an electrician. No one has ever come to try to do what Icahn’s doing,” said Congressman Donald Norcross (NJ-1).

“I am proud to stand with you as you seek to restore your basic rights, such as health care and pension benefits, that all workers should receive. For too long, America’s invaluable labor force has dealt with attacks on fair wages, basic benefits, and earned pensions. Unfortunately, we are witnessing another example of one of these attacks here at Trump Taj Mahal,” said Congressman Albio Sires (NJ-8).

“You get these hedge funds, and these unscrupulous investors who come in here buy the casinos in bankruptcy and all they want to do is milk it. They don’t care about long term investment in your lives, in your livelihoods, they don’t care about Atlantic City; they don’t care about the State of New Jersey. So you aren’t just helping yourselves, you’re helping all of us,” said Congressman Frank Pallone (NJ-6).

“We need to be creating, solidifying, and protecting jobs here in the State of New Jersey… We stand with you and we’ll work in Congress to make sure [that] these people who take their money and run with it and leave us high and dry have to answer to us,” Congresswoman Bonnie Watson Coleman (NJ-12).

The strike in Atlantic City comes on the heels of agreements with four casinos.

ADVISORY: US Congress Members Call on Trump Ally Carl Icahn to Settle Strike at Trump Taj Mahal

Press Advisory for June 24, 2016 at 12:00pm
Contact: Ben Begleiter, 203-668-6676

DNC Vice Chair and Eight Members of Congress Join Striking Trump Taj Mahal Workers on Picket Line Slam Icahn for Slashing Health Benefits, Holding Back Atlantic City Working Families and the Economy

WHAT: US Congressmembers join striking Taj Mahal workers to urge billionaire casino owner Carl Icahn to stop hurting Atlantic City families and the economy, and to negotiate a fair contract

WHO: Rep. Norcross, Rep. Boyle, Rep. Gallego, Rep. Brady, Rep. Watson-Coleman, Rep. Pallone, Rep. Ellison, Rep. Sanchez, DNC Vice-Chair Maria Elena Durazo and Striking Trump Taj Mahal workers.

WHEN: Sunday July 24, 2016 at 12PM

WHERE: Atlantic City Boardwalk at the Trump Taj Mahal

WHY: One thousand cooks, housekeepers, bellmen, bartenders, cocktail servers, and other service workers from the Trump Taj Mahal have been on strike since July 1.
The strike at the Trump Taj Mahal- a casino owned by billionaire Carl Icahn – follows on the heels of tentative agreements with the Tropicana and Caesars Entertainment, which owns Atlantic City’s Caesars, Harrah’s and Bally’s.

BACKGROUND: Many workers at the Trump Taj Mahal, including those with years on the job, have seen only $.80 in total raises over the last twelve years. The cost of living in Atlantic City has risen over 25 percent in the same time period. Housekeepers, servers and other casino workers at the Taj Mahal earn an average of less than $12/ hour.

As the sole debtholder between 2010 and 2014, Icahn extracted $350 million from the property, driving it into bankruptcy and then swooping in to take control. He used the bankruptcy proceeding to strip Taj Mahal workers of health benefits and retirement security. Overall, he cut worker compensation in wages and benefits by 35%.

Without health benefits, half of workers at the Trump Taj Mahal rely on taxpayer subsidized health insurance. A third have no health insurance at all, putting them at risk of bankruptcy in the event of an illness and forcing taxpayers to pay for visits to the Emergency Room. Some of the workers rely on other public assistance programs, like food stamps.

For Immediate Release: Striking Workers at the Trump Taj Mahal lead Protest against Trump and Icahn-omics (WITH VIDEO)

FOR IMMEDIATE RELEASE: Thursday, July 21, 2016
CONTACT: Diana Hussein, dhussein@unitehere.org, 313-460-3119

tajrally1(Atlantic City, NJ) — Hours before Donald Trump was scheduled to give his first speech as the Republican nominee for president, almost 2,000 striking workers and their allies decried Icahn-omics—the economic policies of Trump Taj Mahal owner and Donald Trump’s top choice for Treasury Secretary, billionaire and “activist investor” Carl Icahn.

Since July 1, about 1,000 cooks, bartenders, housekeepers, cocktail servers and other service workers have been on strike at the Trump Taj Mahal to reenter the middle-class after Icahn used the bankruptcy court to strip 1,000 workers of pay and benefits worth more than 1/3 of their total compensation. Many workers at the Trump Taj Mahal, including those with years on the job, have seen only $.80 in total raises over the last twelve years. The cost of living in Atlantic City has risen over 25 percent in the same time period. Housekeepers, servers and other casino workers at the Taj Mahal earn an average of less than $12/ hour.

“We built this business, and we’re tired of billionaires like Trump and Icahn feasting off of our hard work, and leaving us with nothing but the scraps,” said Ruth Ann Yee, a Fast Food Attendant at the Trump Taj. “Three weeks into the strike our resolve is only growing stronger, our fellow casino workers from the rest of Atlantic City are turning out to fight with us, and support from around the country continues to build.”

Both Donald Trump and Carl Icahn have taken millions from the Trump Taj Mahal for themselves while workers have been left holding the bag. As the sole debtholder between 2010 and 2014, Icahn extracted $350 million from the property, driving it into bankruptcy and then swooping in to take control. He used the bankruptcy proceeding to strip Taj Mahal workers of their retirement security and even basic benefits like healthcare. Overall, he cut average worker compensation in wages and benefits by 35%.

“We’ve had tremendous support from elected officials, from the rest of the labor movement, and from visitors to Atlantic City who continue to offer their support and bolster morale on the strike line. Today, people from every community across the region are coming to the strike line to tell the company that driving working people into poverty in order to make an easy buck is not acceptable. We won’t stand for Icahn-omics. When workers from every other casino, large or small, have health insurance that is affordable and that works it is time for the Trump Taj Mahal to step up to the plate,” said Bob McDevitt, President of UNITE-HERE Local 54.

Without health benefits, half of workers at the Trump Taj Mahal rely on taxpayer subsidized health insurance. A third have no health insurance at all, putting them at risk of bankruptcy in the event of an illness and forcing taxpayers to pay for visits to the Emergency Room. Some of the workers rely on other public assistance programs, like food stamps.

Labor, political and community allies from across the region joined the strikers to press the management of the Trump Taj Mahal to settle a fair contract, just as four other casinos in Atlantic City did on June 30.
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More photos: http://bit.ly/tajrallypix

Full video of speakers:

Additional clips from rally: