The three main casinos in Detroit have extended the temporary closure by two more weeks, at least until April 13, as the coronavirus /Covid-19/ outbreak in the state worsens, leaving thousands of its employees with no paychecks.
Health Situation Requires Extension
The initial period for the temporary shutdown of operations expires Tuesday, March 31, and beyond it casino workers and some of the corporate staff will remain only with benefits, as MGM Grand Detroit, Greektown and MotorCity pledged to extend benefits payments through June 30.
“This decision was extremely difficult to make for all of us. Penn National is a family, and we deeply regret the hardship this will place on you and your loved ones. We are extremely motivated and focused on re-opening our properties as soon as it is safe and legal to do so.”Jay Snowden, President and CEO, Penn National Gaming
The casino operator Penn National Gaming has 41 casinos across 19 states, among which the Greektown gaming facility in downtown Detroit, all of which are temporarily closed due to states’ governments enforced mitigation measures to halt the spread of the coronavirus.
Trimming Costs Inevitable
In a recent report by Macquaire Research, Penn National Gaming was with cash reserves that would let it last for 5.2 months without operations at the current rate of costs, suggesting cutting costs was inevitable in case of closure extensions.
Indeed, Greektown gaming facility will place about 26,000 employees on furlough to cut on the company’s wage bill, with less than 850 people left to work during the closure period. In addition, Penn National will implement pay cuts for management and people in leadership roles, as the board of directors will have no cash compensation and some corporate team members will also be furloughed.
Casino Emergency Relief Funds And Donations
Both Penn National and MGM have set up emergency relief funds to help employees and local relief organizations, with currently more than $1.2 million available in the fund of the former. MGM Grand Detroit even contacted some large employers like Amazon to find temporary employment for some of its workers.
MGM Resorts, the operator of MGM Grand Detroit, was among the casino companies that started cutting costs by putting employees on furlough even before casinos were ordered to close.
The third commercial gaming facility in Michigan, alongside all 23 tribal ones, MotorCity, is owned and operated by the wealthy Ilich family. All 26 gaming venues have been closed since the order from State Gov. Gretchen Whitmer banned large gatherings of people.
“We are hopeful this temporary closure will have a positive impact on stemming the tide of COVID-19.”MotorCity official statement
All three casinos donated their food stock to local food banks, MGM and MotorCity donated gloves and supplies for the Detroit bus drivers, and Greektown even offered its facility for temporary health-care site.