Wynn Resorts will pay $5.6 million to resolve a long-running dispute with dealers at its two Las Vegas Strip resorts over tip-sharing.
The agreement, which will compensate an estimated 1,000 current and former dealers, was sealed in an order issued by U.S. District Judge Andrew Gordon, who called it a “fair and reasonable resolution of a bona fide dispute arising under the (U.S.) Fair Labor Standards Act for those collective action members.”
The dispute dates back to 2006, when Wynn Las Vegas, then just a year old, was drawing large numbers of high rollers and dealers were earning more than pit bosses and floor supervisors after tips were factored in. Then-Chairman and CEO Steve Wynn decreed that dealers henceforth would share a percentage of their tips with supervisory staff, partly out of concern for morale among management on the gaming floor and partly over concerns on Wynn’s part, reportedly after the property was hit by a string of big losses at the tables, that the interests of his dealers might be too closely aligned with his players.
To sidestep the fact that tip-sharing with management is illegal under federal law Wynn Las Vegas reconstituted the positions of pit boss and floor supervisor, designating them “casino service team leads,” becoming the only property on the Strip with such a designation and the only one to allow other employees to share in its dealers’ tip pool.
The dealers, who are represented by Local 3555 of the United Auto Workers, sued in Nevada state court to overturn the policy without success and then took their case to federal court in 2013 and again in 2018, demanding the return of as much as $50 million in lost tips.
After Wynn resigned early in 2018 in response to accusations of sexual harassment, his successor as CEO, Matt Maddox, sought to resolve the dispute by raising dealer pay $2 an hour and reducing the amount of tip-sharing to 12 percent.
Nonetheless, some current and former dealers claim the policy cost them hundreds of thousands of dollars, while the latest settlement, which was reached with the help of a mediator with the 9th U.S. Circuit Court of Appeals, will pay those involved in the class action less than $4,200 each after attorneys’ fees and court costs. They can, however, decline the settlement, and those who do can file their own actions.
“We are pleased that all of the parties worked cooperatively to reach a resolution and bring this matter to an amiable conclusion,” a Wynn Resorts spokesman told the Las Vegas Review-Journal.
