Casino and hotel operator Sun International is indefinitely shutting two gaming locations in South Africa because of the financial pressure of COVID-19 lockdowns.
On March 24, the government of South Africa ordered a national lockout of non-essential companies, including Sun International hotels and casinos. The firm released a statement on Friday that it intended to increased hours and wages for workers as its companies reopened on May 1.
The reopening would take place on a limited basis, with plans based on customer demand to scale up operations. Permanent full-time workers will see their salaries cut by 20 percent, while workers making more than ZAR1 m (US$ 53k) a year are seeing a 30% cut.
The company admitted that the pay cuts would have “substantial impact” on workers, but claimed that “we need to ensure the company’s long-term sustainability so that we can protect as many jobs as possible.” Without the cuts, Sun’s lenders “will no longer provide the capital we need to continue to operate.”
Sun CEO Anthony Leeming also declared that after the expiration of the lockout, the Carousel Casino in the North West province and the slots-only Naledi Casino in the Free State will not reopen. Leeming said the Naledi venue was “for several years” a money-loser, while Carousel also had “for some time” suffered losses, and the lockdown “impacted our ability to continue subsidising under-performing properties.”
While Sun has pledged to work with labour representatives to mitigate the impact of the revisions, the SA Commercial, Catering and Allied Workers Union (Saccawu) is allegedly planning to seek court recourse over Sun’s “reckless and irresponsible” actions.
Since last spring, when the company closed two other South African properties, Sun had been caught in a retrenchment phase, part of a wave of closures that also saw it shutter a casino based in Panama. Many of Sun’s remaining Latin American businesses have also seen the pandemic threaten their operations.