Trump Casinos ask judge to approve termination of union contract

Both sides made their arguments in federal bankruptcy court in Delaware, where a judge was expected to rule later Tuesday on whether Trump Entertainment Resorts will be allowed to terminate its union contract.

If the ruling goes against the company, Trump Entertainment is likely to say it will close the TajMahal on or before November 13. The company was supposed to notify the New Jersey Division of Gaming Enforcement by Monday as to whether it will shut the casino, but said it wanted to see what the judge ruled. Your honor, we need this relief now," said company lawyer Kris Hansen. "It's needed to avoid liquidation. We need it to save 3,000 jobs; we need it to help keep Atlantic City alive."

Hansen accused Local 54 of the Unite-HERE union of dragging its feet in negotiations and not wanting to grant concessions to Trump that would then apply to other casinos under a longstanding "most-favored" clause in the union contract. "We have a patient on the table in critical condition and a room full of doctors all staring at each other," Hansen told the judge. "No one wants to touch the patient, and the patient dies from inaction."

The company says it needs big union concessions and massive tax breaks from Atlantic City and New Jersey — both of which have already rejected the demand. It is seeking to have Atlantic City lower its property tax assessments by nearly 80 percent, to have the state contribute $25 million in tax credits, and for union workers to give up their pension and health insurance. If all those concessions are made, billionaire investor Carl Icahn would pump US$ 100 million into the casino and become its owner. Icahn, who also owns the Tropicana Casino and Resort, owns Trump Entertainment's roughly US$ 285 million in debt.

Trump Entertainment says it is not seeking to cut workers' pay. But William Josem, a lawyer for the union, cited company proposals that would do precisely that. By eliminating paid lunch breaks, the company would reduce the annual pay of the typical worker, earning less than $12.50 an hour, by US$ 1,600 per year. Combining employee classifications also would bump some workers into lower pay brackets.

The union has offered US$ 2.4 million in annual concessions, but the company wants US$ 14.6 million a year in givebacks. If the TajMahal closes, it would be the fifth of Atlantic City's 12 casinos to go belly-up this year.