The Trump Organization is seeking U.K. and Irish bailout money to help cover wages for bartenders, bagpipers and other employees furloughed from its European golf properties because of the coronavirus lockdown.
Overseas businesses owned by U.S. President Donald Trump can tap government funds meant to help retain workers. In the U.S., by contrast, they’re specifically written out of the enormous U.S. economic relief package. The result is a potentially stark gap between how workers in different countries may weather the crisis, even within the same global operation.
In the U.K. and Ireland, where Trump owns three money-losing golf resorts, companies can tap enough government cash to pay most of their workers’ salaries. It’s unclear whether the Trump Organization is paying the balance of the salaries for furloughed workers.
In the U.S., roughly 2,000 employees dismissed from Trump golf courses and hotels will have to line up with millions of others to apply for unemployment payments.
There’s nothing improper about Trump companies seeking the U.K. and Irish funds, which are offered universally to help workers weather the crisis. Even so, social-media blowback has been swift against deep-pocketed owners who could arguably weather the crisis without seeking state handouts. These include Victoria Beckham, the former Spice Girl who reportedly furloughed as many as 30 employees at her money-losing luxury fashion label.
Martin Ford, an elected official in Aberdeenshire, Scotland, where one of the resorts is located, said that a similar standard should be applied to Trump, who’s boasted of his billions.
“The huge tab for this will be borne throughout the whole population through higher taxes,” said Ford, a longtime critic of the Trump resort. “If what he says about his personal wealth is true, Trump doesn’t need the money, and I don’t see why U.K. taxpayers of the future should be helping him out.”
Alan Garten, the Trump Organization’s chief lawyer, didn’t respond to requests for comment. Managers at two of the sites said they had taken measures offered by the government to protect their employees.
Although the Trump family business was explicitly prohibited from benefiting from federal aid authorized in the last few weeks by Congress, its hotel in Washington is seeking separate relief on $3 million of annual rent that it pays to the U.S. General Services Administration for use of a government-owned former post office, the New York Times reported on Tuesday.
Trump’s three resorts in Scotland and Ireland were just gearing up for the golf season before governments ordered businesses to close last month to prevent the spread of the coronavirus. Now they’re among the tens of thousands of companies seeking to tap state relief programs. Companies in the U.K. and Ireland can claim the funds to cover furloughed employees as long as they’ve been paying payroll taxes.
“We’ve laid off the vast majority of our staff,” Joe Russell, the managing director of Trump’s Doonbeg resort on Ireland’s west coast, said in an interview. He declined to say how many had been let go or furloughed under the government’s wage subsidy program. “We are ensuring they’re looked after in terms of the government schemes that are available,” he said.
The Irish wage subsidy program, which has been up and running for several weeks, pays companies to cover 70% of furloughed staff’s weekly take-home pay, subject to a cap, as long as they’re kept on the payroll. For the lowest earners, the government will cover as much as 85% starting next month. A separate Irish program allows individuals who’ve lost work because of the pandemic to claim a weekly payment.
The U.K. formally launched a similar program on Monday to cover 80% of workers’ salaries capped at 2,500 pounds ($3,100), receiving applications from more than 140,000 companies on the first day.
Companies in both countries must apply for the funds on behalf of their employees and are encouraged to make up the difference so workers can get their full salaries.
Russell, the manager at Trump Doonbeg, declined to say whether the resort was topping off the government-funded wages. He said that staff numbers vary according to the season but that during peak times the resort employs about 300 people.
The resort was due to open at the end of March, leaving those scheduled to start in limbo until the government stepped in with additional direct payments to support workers nationally affected by the lockdown, said Rita McInerney, a local business owner who lives nearby.
McInerney said the resort has about 90 year-round employees, some of whom are continuing to work as part of a skeletal maintenance staff. She said she’d heard from locals that the rest who’ve been let go are using the government wage subsidy program.
“If by availing itself of government subsidies it keeps the business employing people here, then of course they should use it,” McInerney said. “The Trump Organization have been very good to local community.”
Trump Turnberry in Scotland is applying to tap the U.K. bailout funds for employees, according to Peter Henderson, a local elected official who lives near the resort and has spoken to workers there.
Like any company, he said, the resort should take advantage of the relief program. “There’s no one playing the course. They followed the rules and closed up shop,” he said.
Ralph Porciani, Turnberry’s manager, didn’t respond to questions for comment.
“Like millions of businesses around the globe, we have been forced by government mandate to temporarily close our hospitality and leisure facilities,” said Sarah Malone, executive vice president of the Trump resort in Aberdeenshire. “We are no different to any other business, including many media companies — this has nothing to do with Trump and does not benefit the business — the actions we have taken are solely to protect people and their families who would otherwise be out of work and struggling to survive financially.”
She declined to comment on the resort’s use of government funds to cover wages.
Trump has invested several million dollars over the past decade to buy and revamp the three resorts in Scotland and Ireland, which have continued to lose money, according to their government disclosures. It’s unclear whether Trump has financed the resorts through bank loans or the Trump Organization’s cash flow.
His Aberdeen resort lost more than 1 million pounds in 2018, the last year for which results are available. Trump has provided more than 40 million pounds of interest-free loans to the resort, which has never posted a profit, and employed 77 people, according to 2018 filings. He won approval last year for a 150-million-pound plan to expand the resort by building vacation homes.
Trump’s Doonbeg resort in Ireland, which he bought in 2014, lost 1.5 million euros ($1.6 million), in 2018, but revenue increased by 7% to 11.4 million euros, according to filings. His flagship Turnberry resort lost 10.8 million pounds in 2018, the disclosures show. In total, Trump has lent 115 million pounds to Turnberry since he bought the resort in 2014.
–With assistance from Dara Doyle.
This article was provided by Bloomberg News.
