A Palms nightclub employee who worked at Kaos says she was terminated in an unlawful manner, alleging that the casino failed to give her 60 days notice.
On Tuesday, Red Rock Resorts (RRR) executives announced the immediate closure of Kaos. It had been open only since April.
A day later, Alyssa Faulstick, who tells the Las Vegas Review-Journal that she was employed at Kaos as a “lead cocktail server,” filed a lawsuit against RRR. Her attorneys say the company violated the Worker Adjustment and Retraining Notification Act of 1988, a federal labor law that requires employers with 100 or more employees to provide a 60-day advance notification of layoffs.
Faulstick says she and her coworkers learned of the Kaos closing through the media. The lawsuit contends she and others have suffered damages in excess of $15,000.
It’s definitely been disheartening,” Faulstick explained. “We’ve all put in blood, sweat and tears to get the venue open and try to turn it into what it could be.”
Kaos was part of RRR’s $679 million renovation of the off-Strip casino. The company acquired the Palms in 2016 for $312.5 million.
RRR CEO Frank Fertitta III said the company could no longer justify the expense of running the nightclub. He said booking marquee entertainment acts is “excessively high,” and the casino floor wasn’t benefiting from crossover traffic from Kaos.
In Palms’ termination letter to Kaos team members, the casino offered workers two options: two weeks of severance, or to work on an on-call basis during the next 60 days.
They are required to notify the casino of their decision by today at 5 pm PT. “We deeply regret the impact this has on individual Team members and their families,” the letter stated.
“If you are interested in pursuing other opportunities within Station Casinos LLC, the Employment Recruiters will work directly with you to identify opportunities for which you may be qualified,” the company added. “Hopefully the above will indicate our commitment to provide you with the necessary information, support, and tools to allow you to make the appropriate decisions for yourself.”
RRR told the RJ it doesn’t comment on pending litigation, and therefore had no comment.
The Worker Adjustment and Retraining Notification (WARN) – according to the US Department of Labor – is to provide protection to workers and their families.
The Labor Department explains there are three exceptions to WARN. One is “unforeseeable business circumstances.”
This exception applies to closings and layoffs that are caused by business circumstances that were not reasonably foreseeable at the time notice would otherwise have been required,” the Labor Department explains.
RRR CFO Stephen Cootey told investors this week that the club was elevating overall expenses for Palms due to “the entertainment fixed-cost structures associated with Kaos.” Fertitta added that Pearl Theater concert-goers typically patronized the Palms restaurants and casino, but that wasn’t the case with Kaos guests.
“We did not see that correlation with the nightclub. And one could even make a case that may have had a negative impact to the core gaming customer at the property,” the billionaire concluded.