Under fire
A UK subsidiary of German gambling giant Gauselmann Group, Merkur Slots, has come under fire for a controversial staff bonus scheme.
A Guardian exclusive revealed that Merkur, which operates 262 Adult Gaming Centers (AGCs) across the UK, pays its staff “bonuses linked to how much gamblers lose.”
condemned by MPs and campaigners as “appalling.”
With just over two weeks before the Chancellor announces expected tax increases in the autumn budget, Merkur’s incentive scheme was condemned by MPs and campaigners as “appalling.”
According to an internal document, bonuses for Merkur AGC managers are worth 80% of annual salary with most of the payouts linked to “controllable profit.”
Given the massive incentive, Merkur’s managers are highly motivated to hit profit targets, targets that reportedly include slot machine takings.
MPs savage AGC
Slot machine revenue under the “controllable profit” part of staff bonuses is the source of the widespread ire. Labour and Tory MPs warned of the “potential moral hazard” of bonus schemes tied to slot machine revenue.
One of the warnings cited was that the bonus could cause AGC employees “to look the other way when vulnerable people are racking up huge losses” on slot machines. The negative public exposure was met by a Merkur statement that it “strongly rejects” any suggestion its bonus scheme jeopardizes safer gambling objectives.
Merkur attorneys argued that a portion of the controllable profit bonus includes undergoing safer gambling training. Ex-Tory leader Iain Duncan Smith acknowledged the safer gambling link but stated the scheme looked like “an incentive not to intervene” when gamblers are losing money.
AGCs not walking the talk
Smith said these firms were paying “cynical lip service to their ‘obligation’ to stop harmful gambling.”
called for their immediate change
Labour MP Dawn Butler, meanwhile, said the bonuses appear to “completely contradict” AGCs’ corporate social responsibility commitments. She called for their immediate change. Butler also questioned why the UKGC permitted AGCs to allow such bonus schemes.
Labour MP Alex Ballinger weighed in by stating the bonus scheme “shows a complete lack of responsibility and the urgent need for greater regulation.”
