Published: February 1, 2022 at 12:03 am.
Last update on: January 31, 2022, 03: 20 hours.
Red Rock Resorts (RRR) is the target of another attack from the Culinary Union, the largest casino association in the United States.
In a letter to the U.S. Securities and Exchange Commission (SEC) attorney general, the Culinary Union urges the financial markets regulator to investigate why RRR has a board of business. Red Rock Resorts is a major shareholder in Station Casinos, the private unit made up of billionaires Frank III and Lorenzo Fertita.
In his letter to Gorman, culinary research analyst Zachary Popel said the union questioned whether RRR had violated the SEC’s rules when it came to diversity requirements in corporate governance.
Red Rock’s five-person board of directors has been the same white men since its 2015 IPO, and we believe Red Rock’s justification for the composition of its board is based on incomplete claims,” Poppel said.
Red Rock Resorts is the only licensed publicly traded gaming company in Nevada that has a board without a woman. There are currently nine publicly traded casino companies operating in the state.
Union, RRR Long at Odds
The fertita and the culinary union have a deep-rooted opposition to each other. The billionaire brothers successfully sought to keep the Federation out of Nevada casinos for many years.
The union battles and Red Rock workers have seen their compensation increase before the vote, which leads to the casino’s workforce deciding not to join unions.
After filing several complaints, the National Labor Relations Board (NLRB) intervened in a federal injunction filed in Nevada US District Court, asking the judge to override the vote. Almost all casinos in the strip are represented by gastronomy, the notable exceptions are The Venetian and Palazzo.
Red Rock said the pay and benefits improvements announced in 2019 were in the works long before employees began their efforts to organize at the hotel.
The NLRB case is still ongoing. Meanwhile, US courts have ordered RRR to hand over internal communications in the lead-up to the announcement of the new payment structure to the NLRB.
“the [court] The decision penalizes the members of the Red Rock team and the properties of Red Rock because Station Casinos has treated its team members very well,” the company’s statement argued last year.
The Nasdaq Board Diversity Rule, approved by the Securities and Exchange Commission last August, requires companies that are publicly traded on Nasdaq exchanges to have “or explain why there are at least no diverse directors” by August of 2023. Reasons Nasdaq states that diverse boards are “positively associated with improved corporate governance and financial performance.”
In the gaming industry, Wynn Resorts is currently leading the way in terms of female representation. The casino giant overhauled the composition of its board of directors in the wake of the career-ending sexual misconduct allegations made against its founder, namesake Steve Wynn in 2018. Wynn Resorts has four women on its 10-member board of directors.
Casino Company – Board Size – Female Directors
Red Rock Resorts – 5-0
Las Vegas Sands – 11 – 3
Caesars Entertainment – 10 – 3
Boyd Gaming – 10 – 3
MGM Resorts – 12-4