Las Vegas As a Workers' Paradise
By Harold Meyerson
The American Prospect
Tuesday 15 January 2008
The hotel workers' union boosted wages and transformed dead-end jobs into middle-class careers in the very belly of the casino economy. Here's how it happened.
Editors' Note: This piece was originally published in the January 2004 print issue. Harold Meyerson has further reflections on the upcoming Las Vegas caucus here.
What's Right With This Picture?
Las Vegas - In the middle of his life, Sylvester Garcia decided he'd had enough of the cold and the heat. He'd been a welder in the copper-mining towns of New Mexico for almost a quarter of a century, but, he says, "I got tired of welding, of the mud, of the rain, of too much hard work. So I told my wife, 'I'll try the casinos.'" In short order, he became a dishwasher at the Dunes Hotel on the Las Vegas Strip, then moved to the Luxor when the Dunes was leveled to make way for the Bellagio.
At first glance this wasn't a great career move. Dishwashing in America, as everybody knows, is almost always a minimum wage job devoid of benefits or security. Nonetheless, Garcia insists, "I love my job." And he's not kidding.
Among his fellow dishwashers, however, he has to be in a distinct minority. According to "The Coffee Pot Wars," an essay by Annette Bernhardt, Laura Dresser and Eric Hatton in the new Russell Sage Foundation study of low-wage work, the median hourly wage of the American hotel dishwasher in 2000 was $7.45 - a little better than the housekeeper's $7.09. Even luxury hotels seldom pay their low-end employees much more than the minimum wage. And while wages have stagnated, hours have declined, from 40 a week for low-end hotel workers in 1960 to 31 in 2000. At one hotel they studied, the authors concluded that 60 percent of the kitchen staff held down two jobs.
Garcia holds just one, but his hourly wage at the Luxor is $11.86 - $4 higher than the industry average. He is paid for 40 hours every week, even if the company actually needs him for fewer. He has family health insurance paid for entirely by his employer. He has a defined-benefit pension. He has three weeks of vacation every year, which he likes to spend hunting in Canada.
Far from a life of quiet desperation, Garcia's seems full of noisy exaltation. On the evening I visit him, three grandchildren are careening around his house, a six-bedroom home built in 1988. Garcia's next-door neighbors are an attorney, a minister and, over the back fence, an air-conditioning mechanic. A legion of his fellow hotel workers inhabits the surrounding blocks.
Garcia's is a face, and his neighborhood a place, that doesn't neatly fit into America's current image of itself. Beneath a wave of silver hair, his face has the crevasses of someone who's worked in the Southwest sun for decades. With his droopy moustache, he could pass for a Mexican village chieftain or a sailor on Sergei Eisenstein's Battleship Potemkin. And this patriarchal proletarian inhabits a relatively new middle-class-working-class-white-Latino suburb at a time when such neighborhoods hardly exist anywhere else in the country.
Something is right with this picture, so right that in an America where Wal-Mart and a thousand other unnatural shocks drive working-class living standards downward, we can scarcely account for it. The picture is incomprehensible unless you understand the role that a union - Culinary Workers Local 226, the Las Vegas local of the Hotel Employees and Restaurant Employees International Union (HERE) - has played in the lives of its 48,000 members, their families and the city as a whole.
Local 226 is probably the largest - and surely the most remarkable - local union in the United States. While most unions have been shrinking or struggling to hold their own over the past several decades, and while hotel union membership has declined from 16 percent of the hotel workforce in 1983 to 12 percent in 2000, Local 226 has grown by 30,000 members since its low point in 1988. It has done that by organizing virtually every hotel on the Vegas Strip, so that roughly 90 percent of the jobs in the city's major hotels are unionized. Considering that Nevada is a right-to-work state where employees can work in unionized workplaces without joining the union, this is a breathtaking achievement.
The key is "union density" - the unionized share of total jobs in a local occupation or industry. The authors of the Russell Sage study conclude that hourly wages in the hotel industry are $3 higher in cities with high union density than they are in ones where it's low. Even in unionized cities, however, the authors write that the union effect is minimal on work schedules or career ladders for such dead-end jobs as housekeeping. "This industry doesn't focus on mobility," one hotel executive told Bernhardt, Dresser and Hatton. "We've done a really poor job of recognizing talent and building our own."
But there's high density and then there's Vegas. Housekeepers in Las Vegas make $11.40 hourly; tipped hotel employees have a $9.60 hourly base wage, the highest in the land. At a time when draconian bottom-line pressures on most hotel chains have increased the number of rooms that housekeepers must clean, Local 226's contract last year actually reduced the number of rooms that housekeepers must attend to in many Strip hotels. And at the union's thriving culinary academy, funded entirely by contributions from the hotels, housekeepers can learn the skills to become cooks or servers - and servers to become gourmet waiters or wine stewards, and gourmet servers and wine stewards to become sommeliers.
Nor is it only union members who benefit from the union's work. D. Taylor, the secretary-treasurer of Local 226, figures that when you add in the workers at nonunion Vegas hotels that have to match the wage levels at unionized hotels, and the families of all these hotel employees, the total number of people whose living standards have been raised is 175,000 to 180,000 (and that's not counting the merchants and workers at whose stores the hotel employees shop). In a metropolitan area of 1.4 million, that means the union has transformed the entire city.
Viewers of Frank Capra's classic It's A Wonderful Life will recall how Jimmy Stewart's character of George Bailey heads a Building and Loan where working-class residents of Bedford Falls can borrow the funds to purchase homes. When Bailey wishes he'd never been born, he's shown a nightmare image of Bedford Falls called Pottersville, named after the town's miserly banker who has closed down the Building and Loan, impoverished the working class and immersed it in a world of booze, loose women and other depravities.
Ever since it was a gleam in Bugsy Siegel's eye, Las Vegas has been America's No. 1 Pottersville, rife with gambling, pawnshops and prostitution. Now, courtesy of Local 226, it's also America's No. 1 Bedford Falls - the only city in the land where service-sector workers in supposedly dead-end jobs can afford to buy homes, retire securely and put their kids through college. "We've forced the social contract [into existence] HERE," says D. Taylor. And "forced" is a carefully chosen word.
A New-Model Union
Here came to Vegas in the 1950s, as the first generation of Strip hotels were still going up and the Rat Pack was just beginning to appear together. "The union kept up with the growth HERE until the late '70s," says HERE President John Wilhelm, the mastermind of Local 226's rebirth and subsequent explosive growth in the '90s. But by the late '70s the union was losing its footing. In the mid-'80s, six hotels decertified the union, persuading their workers to vote the union out as their bargaining representative. Four other hotels that had signed the 1984 contract illegally reneged on the agreement and got away with it. The union's health-care plan was going belly up. Not surprisingly, workers were quickly losing confidence in their once-powerful union. With negotiations looming two years hence, the membership elected new local leaders in 1987, who then approached the international for help. The international responded by sending in a new team with a new approach to unionism.
In a number of old-guard HERE locals, the union's business was performed by less than accountable business agents. In the late 1960s, however, HERE hired recent Yale graduate Wilhelm to organize the university's clerical and blue-collar workers. Under the guidance of veteran HERE official Vinny Sirabella, Wilhelm took the opposite tack, building a campus-wide organizing committee that grew to include many hundreds of members. It turned out that member participation actually worked: In 1984, the union organized Yale.
When the Vegas local called for help, HERE responded by sending in Sirabella's disciples - Wilhelm in overall charge, D. Taylor to run the day-to-day operations and a host of others - to build a new kind of union. Local 226 had never had workers' committees. "We had to build committees in hotels to ward off any more [decertifications] and to prepare for street actions - for the first time ever," Taylor recalls.
The local's make-or-break challenge was to organize the Mirage, the first mega-hotel on the Strip, which was set to open in November of '89. The Mirage's developer was Steve Wynn, who already owned the Golden Nugget downtown and whose giant, themed hotels would change the face of Vegas. What the union wanted from Wynn was a neutrality agreement pledging that management would not wage an anti-union campaign. In recent decades, most American companies facing a unionization campaign threaten workers with job loss or plant closing, or actually fire known union supporters - totally illegal tactics for which the law, alas, stipulates no serious penalties. Now, the union asked Wynn to recognize it when it had obtained the signatures of a majority of his workers - a process known as "card check."
To get this deal, the union offered to scrap obsolete work rules that had established 130 job classifications, most of them never even filled. It also used its political clout in Washington to derail a pending Internal Revenue Service plan to withhold the casino winnings of noncitizens, which would have wiped out much of the casinos' high-roller trade. Alongside these carrots, the union brandished the stick of its newly created, possibly militant workers' committees. Soon Wynn became the first owner to sign a contract that authorized card-check recognition. The reconstruction of Local 226 had begun.
Other hotel owners, however, were appalled at card checks, and 13 refused to sign. All the while, the union was hiring new staffers, who were identifying and developing hundreds of activists at each of the hotels. "We had to convert from business unionism to rank-and-file unionism," says Taylor - and they did.
The first key battle came at the Horseshoe, a downtown hotel owned by Jack Binion, a Wild West entrepreneur if ever there was one. The local struck the Horseshoe in January of '89; picketers by the hundreds were arrested. But the Horseshoe's business plummeted, and after nine and a half months, Binion signed. The other hotels, stunned at this show of union resolve, fell into line.
All, that is, but the Frontier, an aging strip hotel whose ancient r gime cowboy owners adamantly refused to recognize the union. The local struck the Frontier on Sept. 21, 1991, and stayed out for six years, four months and 10 days, during which time not a single one of the Frontier's 550 unionized workers crossed the picket line. Finally, in early 1998, their business ruined, the Frontier owners sold the hotel to new buyers who agreed to card check, and the strike ended with a mass victory rally that closed down the Strip.
"I remain to this day in awe of the Frontier strikers," says Wilhelm. "They made clear that the workers would do whatever was necessary to protect their standard of living."
Going into the negotiations of 2002, the union's chief strategy was to demonstrate to management that its members' resolve had not in any way flagged. This was chiefly accomplished at the local's bargaining rally, held in the University of Nevada, Las Vegas' cavernous Sports Arena, which was attended by 23,000 members of the local - slightly less than half the total membership. After that, no hotel was willing to risk a strike. The new contract cut the housekeepers' workload, left the employers' responsibility for health coverage intact and provided members with an average $3.23 hourly raise.
The Skilling Fields
When workers apply for employment at the Vegas hotels under contract with Local 226, they go to the union hall for a skill assessment. If they have no experience, or wish to improve their skills, they are referred to the local's Culinary Training Academy. There, they are offered free courses in every nonmanagerial aspect of hotel work. The academy is funded entirely by employers, who in the latest contract with the union agreed to pay 3.5 cents per worker per hour to fund the training, with a curriculum developed jointly by management and labor.
Roughly 18,000 workers have graduated from the academy in the past nine years; three-quarters of them, says Taylor, are still employed by the hotels. Currently, 2,500 students are enrolled in the academy, according to Executive Director Steven Horsford, and with new Strip hotels springing up regularly, the owners "are asking us to double that figure." On graduation day, the hotels often hire the entire graduating class. Those not hired become extras at the union's hiring hall, where most move up to full-time employment.
This May, the academy moved its digs to the new Nevada Partnerships complex in North Las Vegas, a caf au lait- colored group of buildings perched atop a hill and set off against the brilliant blue desert sky. The looks can be a bit deceiving; as Horsford points out, the African American neighborhood in which the school is situated has 15 percent unemployment, and the academy spends a good deal of effort recruiting young people from the area for its entry-level classes.
The entry hall is taken up largely by a dining room, where a class in busing tables is under way when I enter, and a class in serving is taking place when I leave. As events would have it, I tour the school on Wednesday, the day that its one and only 45-week course is held. This is its famous sommelier class, initiated in 1997 and still taught by Angelo Tavernaro. One of the 53 certified master sommeliers in the world, Tavernaro was in charge of wines at Caesar's Palace for 20 years and founded the wine cellar at the Rio.
Tavernaro's students are a testament to the union's - and Tavernaro's - vision and determination. There's Mike, who was hired to bus tables at the Luxor 10 years ago. Through courses at the academy, he moved up the ladder to server, waiter in a gourmet restaurant and now wine steward. There's Diane, who eight years ago went to the union to see about getting a job in wine and now counsels Caesar's Palace patrons who want the proper bottle for their room-service dinners. The union said, "'You can do this!'" she recalls.
Today's course is on the wines of Australia, and Tavernaro, who's provided his students with reams of handouts and numerous wines to taste, proceeds region by region, valley by valley, vineyard by vineyard, noting soil composition, annual rainfall, temperature variance and their effects on flavor, acidity and much else. It's a lot of material to master, and it comes interspersed with lessons in history, marketing and philosophy. Shiraz, he notes, was originally developed in the ancient Persian city of the same name, and was brought to Australia more than a millennium later by Silesian immigrants who settled in the warm (like Persia) Barossa Valley. Some Vegas high rollers, Tavernaro points out, may not really have all that much money and just want to impress their friends, so he customarily begins by recommending the cheapest of his great wines, not the bottles going for $4,000. Until the past few decades, he laments, for the mass of Americans, "Wine has historically been not something to drink but get drunk with." This Tavernaro attributes to "the Puritan influence," words he spits out as if tasting the foulest of merlots.
If the example of Local 226 demonstrates anything, it's that union density is the most sweeping and effective - and likely the only - way to bring middle-class income, stability and security to the lives of otherwise low-wage service-sector workers and their communities. In a globalized economy, even high levels of unionization in manufacturing industries such as auto and steel have been unable to protect workers from seeing their jobs shipped abroad and having to take lower-paying jobs in their stead. But with the continuing shift to a service-sector economy, the number of workers whose jobs cannot be exported - from sales clerks and cashiers to janitors, servers and housekeepers - continues to grow.
Yet the shift from a manufacturing to a service economy has occurred during (and contributed to) a period of union weakness, a period in which many unions have forgotten how to organize. The success of HERE and the Service Employees International Union (SEIU) in organizing and winning decent living standards for hotel workers and janitors remains more the exception than the rule within the labor movement. What sets HERE and the SEIU apart is their relentless focus on increasing their density in local markets and their ability to convert themselves into unions where rank-and-file stewards address the needs of the current members while the staff is freed up to devote all its time and resources to organizing.
The consequences of that transformation are plainly visible in Vegas. UNLV economist C. Jeffery Waddoups has compared the hotel industries in Nevada's two major gambling centers, concluding that the median wage for hotel work in Vegas is 40.2 percent higher than in nonunion Reno. The union in Vegas has also narrowed the disparity between white and Hispanic living standards. (Local 226 is 43 percent Hispanic, 41 percent white.) Fully 81 percent of non-Hispanic and 78 percent of Hispanic hotel and gaming employees in Vegas have job-based health insurance, a level of parity not found in other sectors of the local economy. Among Vegas construction workers, for instance, 70 percent of non-Hispanic workers have such coverage, while just 41 percent of Hispanic employees do.
The union, then, has not directly transformed working-class Las Vegas outside its own industry. But in its effect on the city as a whole, says Jan Jones, who was mayor from 1991 through 1999 and now handles public affairs for the Harrah's chain, "It's made a remarkable difference." Local 226 "ensured that the employees were earning a living wage, and could buy cars and homes."
In Jones' first year as mayor, Vegas had 15 million visitors annually; when she stepped down eight years later, it had 36 million. Housing construction boomed, and the electorate felt economically secure enough to approve bond measures for parks, libraries and schools - enabling the city to build a new school every month. Voters also passed a sales-tax increase to double the city's water capacity. "This is what management and labor working together can produce - a vibrant economy," says Jones.
On my last night in Las Vegas, I get to see the city whole. Sylvester Garcia and union representative Mike Cifaldi drive me to a hilltop at the edge of town and point out which parts of the city were barren desert 10 years ago, or five, or just last spring. "This town has done good for me," says Garcia, as we look out over the lights of casino capitalism and social democracy, of Pottersville and Bedford Falls, shimmering brilliantly in the Vegas night.
Harold Meyerson is executive editor of The American Prospect and a columnist for The Washington Post.