Star Entertainment Stands Down 90% of Staff as COVID-19 Forces Casino Closures

  • The major Australian gaming group put more than 8,000 employees temporarily out of work
  • Its Sydney, Brisbane, Gold Coast casinos are on mandatory coronavirus shutdown
  • The company is doing its best to maintain liquidity while looking after its workforce
  • Stood-down workers will initially get two weeks' worth of paid “pandemic leave”
Night shot of the illuminated facade of The Star casino in Sydney, Australia
The Star Entertainment Group had to temporarily stand down more than 8,000 workers due to the mandatory closure of its three Australian casinos. [Image: Wikimedia Commons]

8,000+ temporarily out of employment

Major Australian casino operator The Star Entertainment Group has been forced to stand down 90% of its total workforce on a temporary basis as a result of the ongoing coronavirus pandemic. 

The company’s casinos across Australia have closed their doors after the Australian government ordered a lockdown of all non-essential businesses. More than 8,000 employees who were on the casino floors, conference areas, and restaurants will be temporarily out of work. 

doing what it can to help preserve a certain level of liquidity

The Star Entertainment Group has gambling establishments in Brisbane, the Gold Coast, and Sydney. As a result of the closures, the company says its financial situation will be materially impacted. It is now doing what it can to help preserve a certain level of liquidity. 

The operator informed, “The Star has taken a very difficult, but necessary, decision in relation to its workforce … these stand downs include senior management.”

Group to grant two weeks’ paid leave

Workers will be getting two weeks’ worth of paid leave, labeled as “pandemic leave.” Other major Australian companies, such as Virgin Australia and Qantas, are not paying their stood-down employees any such leave. 

Once this two-week period has finished for The Star workers, they can use up their long-service leave and annual leave entitlements. Employees will then go on unpaid leave once their total leave period has been exhausted. 

Senior managers and the board of directors will be forgoing portions of their salaries and fees. As of now, the company has approximately AU$480m (US$290m) worth of cash and drawable debt.

John O’Neill, the chairman of Star Entertainment, said the company is trying to strike a fine balance. With the situation being beyond its control, the operator is trying to protect the long-term business as much as possible while also being considerate of the human impact it is having on its workforce. 

A spanner in the works

The share price for The Star Entertainment Group has been slashed by over 40% since the COVID-19 pandemic kicked off and market turmoil began. There have also been major disruptions for future company projects.

share price for The Star Entertainment Group has been slashed by over 40%

The Star is in the middle of a construction project worth AU$2.6bn (US$1.57bn) in Brisbane. It is also upgrading towers at its Gold Coast facility at a cost of AU$370m (US$224m). Delays to these projects look to be inevitable.

Casinos closing worldwide

There are numerous major companies across Australia having to stand down workers. Of the 10,000 people employed by Virgin Australia, around 8,000 have been stood down until at least the end of May. Domestic and international flights have been severely curtailed in the wake of this pandemic. 

Crown Resorts, the other leading casino operator in Australia, has shut down its casinos in Perth and Melbourne. No indication has been given as of yet as to how it will affect the workers at these facilities. 

Across the world, casinos and betting companies have gone into a similar lockdown mode. Pro-gambling lobbyists in the US and the UK are calling on financial aid from their government to help stem the tide for the sector amid mass closures and travel restrictions. 

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