NEW YORK (AFP) – Hotel giant MGM Resorts on Friday said 18,000 furloughed employees in the United States (US) would be permanently laid off as the hospitality industry struggles amid the coronavirus pandemic.
“Federal law requires companies to provide a date of separation for furloughed employees who are not recalled within six months,” CEO Bill Hornbuckle said in a letter seen by AFP.
“Regrettably, August 31, marks the date of separation for thousands of MGM Resorts employees whom we have not yet been able to bring back.”
The US has seen tens of millions of layoffs since COVID-19 broke out, with the wave peaking in late March but nonetheless still potent. In the week of August 22, the latest reported by the Labor Department, around one million people made new claims for unemployment benefits.
Restaurants and hotels have been among the businesses hardest-hit by orders to close down to stop the disease’s spread, and MGM closed all of its US properties on March 17, furloughing 62,000 of its 70,000 employees.
Parts of the US have lifted those restrictions and some MGM workers have returned to their jobs as their hotels have reopened, but in his letter Hornbuckle said “our industry – and country – continues to be impacted by the pandemic, and we have not returned to full operating capacity”.
Hornbuckle said MGM would offer health benefits through the end of September and laid-off workers could re-apply for their jobs when they become available.
The US is home to the world’s worst coronavirus pandemic with more than 180,000 dead and 5.8 million infected.
Congress passed the USD2.2 trillion CARES Act stimulus package to blunt the downturn in the pandemic’s opening weeks, however provisions of the bill supporting laid-off workers, small businesses as well as key industries have already expired or will do so soon, raising fears of prolonged economic damage.