January 4, 2016
The NLRB General Counsel issued a complaint against TPG’s and Leonard Green’s Palms Casino Resort in late October 2015.

Palms Casino settles federal government charges to avoid January 5, 2016 trial

In late October 2015 the General Counsel of the National Labor Relations Board (NLRB), a federal government body, found merit with Unfair Labor Practice charges at TPG Capital’s and Leonard Green & Partners’ Palms Casino Resort in Las Vegas, Nevada and issued a complaint. The complaint set a trial date for January 5, 2016 before an Administrative Law Judge.

(Complaint available here)

The issuance of a complaint means the office of the NLRB General Counsel has conducted an independent investigation of the charges, found merit with the charges, and decided to prosecute the charges.

For example, the NLRB General Counsel’s complaint alleged that the Palms Casino has violated federal labor law several times since June 2015:

“Respondent engaged in the conduct described above in paragraphs 6(a) through 6(c) because the named employees of Respondent and the employees of Respondent formed, joined and assisted the Union, and engaged in concerted activities, and to discourage employees from engaging in these activities.”

“Respondent has been interfering with, restraining, and coercing employees in the exercise of the rights guaranteed in Section 7 of the Act in violation of Section 8(a)(1) of the [National Labor Relations] Act.”

“Respondent has been discriminating in regard to the hire or tenure or terms or conditions of employment of its employees, thereby discouraging membership in a labor organization in violation of Section 8(a)(1) and (3) of the Act.

In September 2015, Palms Casino employees delivered a petition signed by two-thirds of their coworkers to casino management.“Respondent, by Joshua Knight (Knight), near the Employee Entrance at Respondent’s facility: (1) threatened its employees with unspecified reprisals if they supported the Union as their bargaining representative; and (2) engaged in surveillance of its employees engaged in union activities.”

“Since about July 23 2015, Respondent, by three security officers (whose names are currently unknown to General Counsel), in employee transport vehicles near the Employee Entrance at Respondent’s facility, engaged in surveillance of employees to discover their union activities.”

“Respondent imposed onerous and rigorous terms and conditions of employment on its employee Jose Luis Cuevas Guzman by assigning him to more arduous and less agreeable job assignments.”

“About July 23, 2015, Respondent disciplined its employee Juan J. Sanchez.”

To avoid the January 5, 2016 trial set by the complaint, TPG’s and Leonard Green & Partners’ Palms Casino in late December reached a settlement with the NLRB General Counsel. While the casino did not admit guilt, as part of the settlement it agreed among other things to provide a notice to employees stating:

“We will not watch you or give the impression we are watching you to find out about your Union or other protected activities.”

“We will not threaten you with unspecified reprisals for engaging in Union or other protected activities.

“We will not grant wage increases or other benefits and improved working conditions on the condition that you refrain from supporting the Union.”

Palms Casino employee Juan Sanchez attends New Mexico State Investment Council meeting in July 2015 to report to working conditions at the casino. New Mexico is a limited partner with both TPG Capital and Leonard Green & Partners.
Palms Casino employee Juan Sanchez attends New Mexico State Investment Council meeting in July 2015 to report to working conditions at the casino. New Mexico is a limited partner with both TPG Capital and Leonard Green & Partners.

Palms’ efforts to stay “union-free”

In June 2015, Palms Casino employees asked Palms management to remain neutral and ensure labor peace at the resort.

A few weeks later, Palms management posted a notice disparaging the Culinary Workers Union, the main union of casino employees in Las Vegas.

In August, the Palms Casino announced it would outsource the jobs of some food service employees to a subcontractor.

In September, employees attempted to deliver a petition calling for labor peace and neutrality at the resort to Palms Casino management . The petition was signed by approximately 480 employees.

 

What steps have TPG Capital and Leonard Green & Partners taken to ensure their portfolio companies comply with the law?

What role have TPG and Leonard Green played in issues involving employees at the Palms Casino Resort?

Did TPG or Leonard Green recommend the outsourcing of Palms Casino employees’ jobs?