ATLANTIC CITY, N.J. (AP) — The battle for the future of the Trump Taj Mahal casino heated up Friday as the National Labor Relations Board urged a judge to restore workers' benefits and soon-to-be-owner Carl Icahn said the cuts are "an essential sacrifice that must be made" to keep the casino open.
Icahn responded in a letter to employees who demonstrated a day earlier outside his New York offices, saying their union was delaying a new contract by insisting on preserving a health insurance plan he called "a lucrative racket" for union bosses. His letter to Taj Mahal workers came shortly after the labor board filed a brief in support of Local 54 of Unite-HERE, which is trying to overturn an October bankruptcy court ruling that canceled health insurance and pension coverage.
About 100 union members hand-delivered a letter to Icahn's Manhattan offices Thursday claiming the billionaire investor, who also owns Atlantic City's Tropicana casino, is fighting against the little guy. Icahn dismissed that accusation Friday.
"I am fighting for those employees — fighting to save their jobs in the midst of a wholly unstable crisis — and my efforts are being mischaracterized and attacked by a union that exploits those employees for its own gain," Icahn wrote.
The union had no immediate comment on Icahn's letter.
Icahn said Atlantic City "is facing catastrophic circumstances" and the Taj Mahal — which he saved from closing in December by pledging $20 million to keep it afloat — is losing millions of dollars a month.
"The only reason the casino is still open, and the only reason you still have jobs, is because, against the advice of almost all of my advisers, I agreed to provide the Taj Mahal with as much as $20 million in additional loans," he wrote.
Icahn is taking over Trump Entertainment Resorts by swapping the $286 million of its debt that he holds in exchange for ownership of the company.
A bankruptcy judge in October allowed the company to cancel health insurance and pension coverage for Taj Mahal employees; Icahn said those cuts were essential to keeping the casino open and has repeatedly threatened to close it if the union wins an appeal of that ruling.
The labor board on Friday urged the judge to do just that, filing a brief in support of the union that said the October ruling doesn't comply with federal labor law and should be overturned. It remains to be seen what effect, if any, the labor board's assertion will have on the case, which is pending in a federal appeals court.
Trump Entertainment is moving Taj Mahal workers into coverage under the Affordable Care Act and providing a stipend of $2,000 apiece toward the cost.
The company is also changing work rules, including eliminating paid meal breaks, using more outsourcing and increasing daily room cleaning quotas for housekeepers.
"The truth is that those work rules are from a bygone era when Atlantic City was booming," Icahn wrote. "Today, with a struggling company in a rapidly declining industry, those work rules cannot be sustained. "
Icahn said the changes he is making bring the Taj Mahal "into alignment with how almost every company outside of Atlantic City operates."
Wayne Parry can be reached at http://twitter.com/WayneParryAC