Galaxy Entertainment Group shares rose nearly 16 percent last week after reports that the company plans to introduce a 13 percent pay cut for 2,600 gaming staff in Macau starting from 2nd February.
The cuts will be achieved by making 1,600 mainly local staff at the StarWorld resort take two to four days of unpaid leave per month, said the South China Morning Post. The move will mostly affect dealers, dealer inspectors, pit supervisors and cashiers.
Another 800 local gaming staff at three of Galaxy’s franchised casinos—the Rio, President and Waldo—will also have their pay cut. Employees at the Grand Waldo will be excluded.
Philip Ho, GEG’s head of public relations, said the strategy, likely to be enforced until at least December, was to improve the company’s competitiveness without laying off any local people.
All Macau’s operators are expected to trim their overheads during 2009. It’s in response to a year-on-year fall in gambling revenue experienced over three consecutive months at the end of last year. Income fell 7.35 per cent from the previous quarter and 2.55 per cent from a year earlier, to 24.07 billion patacas.
Casino companies have blamed the downturn on restrictions imposed by the central government on travel from Mainland China and a contraction of credit facilities available to VIP gamblers because of troubles in the global economy.
Las Vegas Sands Corp. (LVS) laid off up to 11,000 construction workers in November after suspending work on two sites opposite The Venetian Macao on Cotai.
LVS then introduced what in effect is a 13 percent pay cut for 6,800 local gaming employees by reducing their working hours by four days per month with effect from 1st January. It also laid off 500 foreign workers.
Last month Melco Crown Entertainment imposed a temporary pay cut equivalent to seven to eight percent of salary for 3,600 employees at its Crown Macau casino hotel. This was also achieved by asking staff to take unpaid leave either as holiday or as in-service training.
