Unifor national president Jerry Dias (Credit: AP/Carlos Osorio)
Ontario iGaming market is all set to launch on Apr. 4. The attempt to create a privatized white market for iGaming in the province was first announced in its 202 budget.
Regulatory issues have delayed the launch twice. First Nations have also protested the decision, and now union leaders are speaking out.
The issue of potential job losses in the retail sector has been hovering in the background. On Jan. 11, Great Canadian Gaming released a report it had commissioned from HLT Advisory titled Ontario Gaming Market Assessment.
The report predicted job losses of up to 2600 brick-and-mortar casino employees. It also projected a loss of $550 million annually for the province. Some industry experts are critical of its conclusions, but that hasn’t stopped it from generating concern.
Unknowns worry Unifor leaders
Brick and mortar casinos are already off to a rough start this year. The COVID-19 omicron variant forced them to shut their doors on Jan 4 and took until earlier this month to reach full capacity again. Though it seemed that casinos reopening ahead of the iGaming launch may have given them the benefit of customers returning, the long term concerns about the impact of regulated iGaming remain.
Chris MacDonald, assistant to Unifor national president Jerry Dias told the Windsor Star:
“It’s still unknown how many (online) casino gaming companies will be launched, but it will have a significant impact on current operations, union jobs and revenues.”
Unifor is a general trade union. The workers it represents include more than 12,000 casino employees. The HTL projected job loss of 2600 of those employees is of great concern to the union, especially after the pandemic.
MacDonald also made suggestions for how the province can improve its plan to include land based casinos:
“We are trying to get people’s attention to this, (The plan) should be adjusted to make the bricks and mortar (casinos) more competitive. We would like to see the start date changed and a commitment from finance (ministry) to take a closer look at this than they have so far.”
iGaming works in the US, what about here?
Ontario will be the first Canadian province to legalize iGaming. Being the first means needing to discover what will and will not work.
Ontario Chamber of Commerce President Rocco Rossi, in a letter to Ontario Attorney General Doug Downey stated:
“Ontario is not the first jurisdiction in North America to legalize iGaming… Every U.S. state that has introduced iGaming has done so in a coordinated manner with existing land-based casinos.”
While this is true, operating in Canada is different from casinos operating in the United States. With the exception of Delaware, the US casinos in states with legal iGaming are operating directly in the private sector. These states’ laws extend those casinos’ market access to the include online gaming. Other companies wanting access to the market then have to sign operating agreements with these directly authorized entities.
In Canada all casinos belong to the provincial lotteries. The private sector companies operating the casinos are doing so through operating agreements of their own. They don’t have authorization to serve either the retail or online market directly, and federal law doesn’t allow the province to grant that authorization.
Simply put, the brick-and-mortar casino operators are themselves contractors. Applying the US model to Ontario wouldn’t make much sense under Canadian law.
Problems piling up as launch day nears
Apr. 4 is quickly approaching. These arguments have been buzzing in the background for some time. However, with union leaders getting involved, things could soon come to a head.
There’s also the question of revenue sharing. Brick-and-mortar operators see it as unfair that they pay 55% to the Ontario government, which is expected to agree to a more generous 80/20 split in favor of online operators.
Of course, iGaming also doesn’t just operate itself like an autonomous robot. The companies iGaming Ontario is contracting with employ people too. However, they don’t necessarily live in Ontario. 12,000 land based casino workers do, and they’ve been put through the wringer by pandemic restrictions over the last two years.
All eyes are on Ontario. There’s now less than a month until iGaming launches. More importantly for the Ford government, there are less than three until the next election.