Harrah’s dealer sues to keep cash tips
December 15, 2003
By Susan Wood
Tribune staff writer
A dealer from Harrah’s Reno has filed a lawsuit in Washoe County District Court against the parent company over a policy change in the collection of tips.
The lawsuit filed by Reno attorney Ken McKenna last Wednesday has also named the Internal Revenue Service. No court hearing has been scheduled.
Marion Gavin, one of 220 dealers, objects to a policy in which the casino pays out the tips on the employee’s biweekly paycheck. Before Oct. 31 the dealers collected the cash directly from the players. Gavin wants to keep it that way.
The complaint reads: “The new process now includes tips as wages earned, forcibly removing the money from the employee, depositing them into Harrah’s corporate account.”
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It seeks damages in the amount of $50,000.
Harrah’s at Stateline has paid out tips through the payroll system for years.
Gavin said she’s unsure of the extent of support Stateline dealers give to the system.
“I think, to the best of my knowledge, it’s because they’ve been on a checks system and we’ve been on a cash system,” she said.
Harrah’s Lake Tahoe spokesman John Packer joined corporate spokesman Gary Thompson in saying he couldn’t comment on the legal matter, in particular with it coming out of Reno.
“When change is implemented, there may be opposition to it,” Thompson said.
The policy change at Reno resulted from an IRS audit, as referenced in a letter written to employees by finance Director Marcia Martin that dictates IRS code. The federal law obligates casino staffers to “present to the employer a listing of the actual share of pooled tips received by or given to each employee.”
The IRS cracked down on tip accounting procedures at casinos about a decade ago. Harrah’s Reno is the latest in a line of casinos to make the accounting change.
-Susan Wood can be reached at (530) 542-8009 or via e-mail at email@example.com