Mandatory Staff Retention Could Lower Bids for Pagcor Casinos
Prospective buyers of Philippine Amusement and Gaming Corp (Pagcor) casino properties are likely to resist any requirement to retain existing employees, according to a legal analysis by Philippine law firm Geronimo Law. The paper argues that mandatory staff absorption could reduce bid values if it appears in the terms of Pagcor’s planned privatisation of its Casino Filipino venues.
The analysis covers the employment implications of Pagcor’s proposed disposal of around 40 Casino Filipino branches and satellite venues through an asset sale. A separate proposal, under which the regulator would give up its gaming-operator role and privatise the Casino Filipino chain, remains under review by the Governance Commission for Government-Owned or -Controlled Corporations (GCG), the body that oversees state-owned entities.
Pagcor chairman and chief executive Alejandro Tengco has said the regulator hopes to complete the privatisation process by the end of this year, subject to approval from the GCG and, ultimately, the Philippine president.
Because the deal is structured as an asset sale rather than a share sale, buyers would not be legally required to absorb Pagcor employees, Geronimo Law said. Employment would generally end through action by Pagcor itself, and any related claims would fall to the state-owned corporation rather than the purchaser.
Buyers are expected to seek experienced gaming staff such as dealers, surveillance officers and slot technicians, the law firm said, but their appetite to absorb workers will likely be selective. Any obligation to retain employees would come from the bid terms and the asset purchase agreement, not from current labour law.
“If a mandate survives into the bid terms, expect it to be priced into lower offers and satisfied through engagement of the most marketable job classes,” the legal analysis stated.
The paper, first reported by the Manila Bulletin, set out three possible outcomes for affected staff: redeployment within Pagcor, employment with the successful bidder, or separation with retirement and separation benefits. Workers hired by a private operator would start a new employment relationship, so previous years of service would not automatically carry over unless the transaction documents specifically provide for it.
Employees who are neither absorbed by a buyer nor redeployed within Pagcor would instead be separated by the corporation, and no liability would transfer to the purchaser, Geronimo Law added. Because Pagcor staff are civil servants, any workforce reduction would also fall under civil service rules that apply to government reorganisations.
💡TGJ Take
The structure of this transaction may matter as much as the assets on offer. If retention becomes a bid requirement rather than a legal duty, buyers will likely fold that cost into lower offers, and staff such as dealers, surveillance officers and technicians stand the best chance of a job. For investors weighing the Casino Filipino sale, workforce terms could shape valuations as much as the commercial potential of each property.
