EMPLOYMENT AGREEMENT


Exhibit 10.34

                              EMPLOYMENT AGREEMENT


                  Employment   Agreement,   dated  as  of  July  1,  1998  (this
"Agreement"),  by and between Riviera Holdings  Corporation and its wholly-owned
subsidiary Riviera Operating Corporation (collectively the "Company") and Ronald
Johnson ("Executive").

                In consideration of the mutual agreements hereinafter set forth,
the parties hereto agree as follows:

1.  Employment.  During the "Term"  (hereinafter  defined) the Company agrees to
employ Executive as Executive Vice President of Gaming Operations of the Company
upon the terms and  conditions and for the  compensation  herein  provided,  and
Executive agrees to be so employed and to render the services herein specified.

2. Term of  Employment.  The term of  employment  of  Executive  hereunder  (the
"Term") will be for a three year period commencing on July 1, 1998 and ending on
June 30, 2001, subject to earlier termination as provided in Section 10.

3. Duties. During the Term Executive agrees to (a) devote his full and exclusive
business time and attention to the business of the Company and its  subsidiaries
(vacation  and sick leave in accordance  with the Company's  policy and personal
time consistent  with his position  excluded) and (b) perform such duties as the
Company's chief executive officer shall from time to time assign to Executive.

4. Salary.  During the Term  Executive  shall  receive a salary at the following
rates per annum, payable bi-weekly in arrears ("Base Salary"):

                           One Year Period
                           Commencing

                           7/1/98                             $200,000
                           7/1/99                             $225,000
                           7/1/2000 and thereafter            $250,000





5. Stay Put Bonus.

a.  Executive  shall be entitled to a bonus ("Stay Put Bonus") of $125,000 if he
remains an  employee  of the Company on each of January 1, 2001 and July 1, 2001
(or an  aggregate  of $250,000)  or if  Executive  has been  discharged  without
"Cause"  (hereinafter   defined)  prior  to  each  such  date  he  will  receive
immediately any unpaid balance of the $250,000 Stay Put Bonus.

b. At the closing of a "Change of Control"  (hereinafter  defined)  the Stay Put
Bonus (i) shall be  deposited  in a Rabbi  Trust  with US Bank and (ii) shall be
invested  in a money  market  fund.  One-half  of the amount of the Rabbi  Trust
established  for  Executive  will be paid on each of January 1, 2001 and July 1,
2001  provided  Executive  remains  an  employee  on each  such date or has been
discharged without Cause.

c. A "Change of Control"  shall mean (i) the sale of more than a majority of the
Company's common stock,  (ii) a merger in which the Company is not the surviving
company or a majority of the stock of the Company as the surviving company shall
be held by a party or related group of parties (excluding the present holders of
more than 10% of the Company's  common stock,  Morgens  Waterfall,  Sun Life and
Keyport Life) or (iii) sale of substantially all of the Company's assets.

6. Incentive Bonus.

a.  Executive may be eligible for a bonus ("Normal  Incentive  Bonus") under the
Company's Senior Management  Compensation  Plan (the "Plan").  The Plan provides
for a target of $25  million of EBITDA for the Years 1999 and 2000 with  amounts
being  credited  to the Plan pool up to a maximum of $1.2  million  ("Cap").  If
William  L.  Westerman  ceases  to be the  Company's  Chief  Executive  Officer,
Executive  shall be entitled to no less a Normal  Incentive Bonus (in terms of a
percentage of all bonuses) than in the prior fiscal year and at least 90% of the
bonus  pool  under  the  Plan  will be  distributed  to all  Plan  participants,
including  Executive by March 15 of the following  year. In  calculating  EBITDA
there shall be included any management fees earned by the Company from its Black
Hawk,  Colorado subsidiary ("Black Hawk"), but there shall be excluded any Black
Hawk  EBITDA  until at least a 20%  return has been  earned on capital  invested
(debt and  equity) in Black  Hawk.  Also,  if the  Company  becomes  involved in
projects  other than Black Hawk which require that the Company invest its funds,
a 20% per annum return on such investment must be earned before




any  EBITDA  generated  from  such  project  will  be  included  in  the  EBITDA
calculation  under the  Plan,  unless  the  Company  pays  more than five  times
trailing 12 months' EBITDA, in which case, the ROI will be adjusted accordingly.
Under the Plan the Company's CEO determines in his sole  discretion  (subject to
approval by the  Company's  Board of Directors or  Compensation  Committee)  the
persons to whom Normal Incentive Bonuses are paid and the amount thereof.

b. In addition  to Normal  Incentive  Bonuses  Executive  shall  receive a bonus
("Special  Incentive  Bonus") in an amount  equal to  one-third of any amount in
excess of $1,200,000  which would otherwise be credited to the Plan pool but for
the Cap until  Executive  has received  Special  Incentive  Bonuses  aggregating
$350,000 during the Term and then shall be entitled to one-sixth  (together with
one-sixth for each)* and the other Plan  participants 50% of any excess credited
to the Plan pool.

c. For the Year  2001 if the Plan  EBITDA  target is more  than $25  million  of
EBITDA,  Executive  will be entitled to a Special  Incentive  Bonus based upon a
pro-forma target of $25 million.

d. The amount of the Special  Incentive Bonus that has been earned shall be paid
to the  Executive  on March  15,  2001  and  March  15,  2002  provided  (i) the
Executive's  employment has not been  terminated by reason of (A) resignation or
(B) "Cause"  (hereinafter  defined) and (ii) if the Company  terminates  for any
reason other than Cause,  as the case may be,  Executive will be entitled to his
Special  Bonus prior to March 15, 2001 or March 15, 2002, as the case may be. If
the  Executive's  employment  has  been  terminated  for  (iii)  death  or  (iv)
disability,  the Special  Incentive Bonus earned for the year of the Executive's
death or disability shall be paid in accordance with Section 7(a)(iii) hereof.

e. On the occurrence of a Change of Control (herebefore  defined), at the option
of the Executive:

(i) The greater of the amount earned as a Special  Incentive  Bonus up until the
time of the  Change of  Control  or  $250,000  shall also be placed in the Rabbi
Trust  established under 5b and the Executive shall waive the right to any other
amounts under this Section 6(b) or;





(ii) The Executive may elect to continue to participate in the Special Incentive
Bonus.

7. Death and Disability.

a.  Upon the death or  "Disability"  (hereinafter  defined)  of  Executive,  the
following   amounts  will  become   payable  to  (i)   Executive's   "Designated
Beneficiary" in the case of death or (ii) Executive in the case of Disability:

(i)  Base  Salary  shall  be paid to the end of the  month  in  which  death  or
Disability occurs.

(ii) Stay Put Bonus. A "Pro-Rata" (hereinafter defined) portion shall be paid as
soon as practicable after the date of death or Disability.

(iii) Normal  Incentive Bonus.  Whether  Executive shall be entitled to a Normal
Incentive Bonus for the year of his death or Disability  shall be determined and
paid in  accordance  with the Plan as promptly as  practicable  after the end of
such year,  provided  that (A) since  payment of any Normal  Incentive  Bonus is
normally at the discretion of the Company's chief executive officer, in the case
of death or Disability the deceased or disabled  Executive  shall be entitled to
no less a Normal Incentive Bonus (in terms of percentage of all bonuses) than in
the prior fiscal year adjusted however on a "Pro-Rata" basis, and

(iv) Special  Incentive  Bonus.  With respect to payment of a Special  Incentive
Bonus in the case of Executive's death or disability,  the bonuses shall be paid
promptly after the end of the year in which death or disability  occurred,  on a
"Pro-Rata" basis to the end of the month in which death or disability occurred.

b. The following terms shall have the following meanings:

(i)  "Pro-Rata" - a fraction the numerator of which is the number of days to the
date of death,  Disability  or discharge  without Cause and the  denominator  of
which is 365.





(ii) "Designated  Beneficiary"  shall be the person designated in writing by the
Executive prior to the Executive's death and if the Executive fails to designate
a beneficiary or if a designated beneficiary does not survive the Executive, all
amounts  payable   hereunder   shall  be  paid  to  the   Executive's   personal
representative  or pursuant to the terms of the Executive's  will or the laws of
descent and distribution.

(iii)  "Disability"  - the Company  shall find on the basis of medical  evidence
satisfactory to it that Executive is so totally mentally or physically  disabled
as to be unable  to  engage  in  further  employment  by  Company  and that such
disability  shall be determined to be such that it will cause,  or actually does
cause or has caused, Executive to be absent from work for a period, or aggregate
of periods, in excess of three months in any one twelve month period.

8.  Profit-Sharing  and 401(k) Plan.  In addition to the Base  Salary,  Stay Put
Bonus and Incentive Bonus,  Executive shall be eligible for participation in the
Defined Contribution Plan adopted by Company.

9. Additional  Benefits and  Compensation.  During the Term,  Executive shall be
entitled to:

a.  life  insurance,  group  health  insurance,   including  major  medical  and
hospitalization,  comparable to such benefits offered to other key executives of
the Company;

b. reimbursement for all reasonable expenses incurred by Executive in connection
with the performance of his duties and in accordance with any applicable  policy
of the Company (including 100% of reasonable travel and entertainment expenses),
subject to submission of appropriate documentation therefor; and

10. Termination By Company or By Executive.

a. If the Company shall discharge Executive for "Cause"  (hereinafter  defined),
Executive  shall not be entitled to receive any payment with respect to (i) Base
Salary  after  the date of  discharge,  (ii) the Stay Put  Bonus  and  (iii) the
Incentive Bonus.

b. If the Company shall  discharge  Executive  without  "Cause",  subject to his
obligation to "Mitigate"  (hereinafter defined),  Executive shall be entitled to
(i) Base  Salary to the end of the  Term,  (ii) his full Stay Put Bonus but with
payment  accelerated to the date of discharge and (iii) a Normal Incentive Bonus
"Pro-Rata"  to the date of  discharge  and  otherwise  subject to the proviso of
Sub-Section  7(a)(iii) and (iv) a Special Incentive bonus "Pro-Rata" to the date
of




discharge and otherwise subject to the proviso of Sub-Section 7(a)(iv).

c. If Executive  shall resign prior to the  expiration of the Term, he shall not
be entitled to any  compensation  or benefits from the Company after the date of
his resignation.

d. The following terms shall have the following meanings:

(i) Cause - (A) felony conviction of Executive; (B) a final civil judgment shall
be  entered  after all  appeals  shall have been  exhausted  in which a material
aspect  involved  Executive's  fraud or dishonesty  whether or not involving the
Company,  provided  that the  foregoing  shall not apply to the  action by Allen
Paulson and other  plaintiffs  against the  Company and other  defendants  which
involves  allegations of violation of Nevada law,  including RICO and "fraud" on
the part of the Company,  and which on the date hereof is pending in the Federal
District Court for the Central District of California;  (C) refusal by Executive
to perform  "Reasonable  Duties"  (hereinafter  defined)  assigned to him by the
Company's chief executive officer,  provided Executive shall fail to correct any
such failure  within 30 days after  written  notice  ("Cure  Period") or (D) the
Gaming  Authorities  of the  State of  Nevada  or any  other  state in which the
Company  shall conduct  gaming  operations  shall  determine  that  Executive is
unsuitable  to  act as an  executive  of a  gaming  company  in  his  individual
capacity.  "Reasonable  Duties"  -  Executive  shall  not be  required  (x) on a
permanent basis to spend more than 50% of his business time outside of Las Vegas
(or be required to change his residence), (y) to expose himself to a risk to his
physical  safety or  jeopardize  his ability to be licensed by any state  gaming
authority or (z) perform duties which are  inconsistent  with his role specified
in Section 1 hereof.

(ii)  Mitigate - Executive  shall be required to use his best  efforts to obtain
gainful  employment  as similar as  possible  to his  duties  with the  Company,
provided that (A) a finding by an arbitration tribunal that Executive has failed
to do so will result in the Company  being  relieved  of any  obligation  to pay
Executive and (B) any amount  received by Executive from such  employment  shall
reduce the amount payable by the Company under Section 10(b).





11. Confidential Information; Non-Competition.

a. During the Term and for a three year period  commencing on the termination of
the  Term of this  Agreement  for any  reason,  (i)  Executive  shall  hold in a
fiduciary  capacity  for the benefit of the  Company all secret or  confidential
information,  knowledge or data relating to the Company or its  affiliates,  and
their  respective  businesses  which shall not be public  knowledge  (other than
information  which  becomes  public  as a  result  of acts of  Executive  or his
representatives in violation of this Agreement),  including, without limitation,
customer/client  lists,  matters  subject  to  litigation,   and  technology  or
financial  information  of the Company or its  subsidiaries,  and (ii) Executive
shall not,  without the prior  written  consent of the Company,  communicate  or
divulge any such information, knowledge or data to anyone other than the Company
and those designated by it in writing.

b. During the Term, the Executive will not, directly or indirectly, own, manage,
operate,  control or participate in the ownership,  management or control of, or
be  connected as an officer,  employee,  partner,  director,  or  consultant  or
otherwise with, or have any financial interest in any hotel or casino.

c. During the Term and for a one-year  period  commencing on  termination of the
Term for any reason,  Executive  will not solicit or contact any employee of the
Company or its affiliates  with a view to inducing or encouraging  such employee
to leave the employ of the  Company or its  affiliates  for the purpose of being
employed by Executive,  an employer affiliated with Executive, or any competitor
of the Company or any affiliate thereof.

d. Executive  acknowledges that the provisions of this Section 11 are reasonable
and  necessary  for the  protection  of  Company  and that the  Company  will be
irrevocably   damaged  if  such  provisions  are  not   specifically   enforced.
Accordingly, Executive agrees that, in addition to any other relief to which the
Company may be entitled in the form of actual or punitive  damages,  the Company
shall be entitled to seek and obtain injunctive relief from a court of competent
jurisdiction   (without  posting  of  a  bond  therefor)  for  the  purposes  of
restraining Executive from any actual or threatened breach of such provisions.





12. Miscellaneous

a. This  Agreement  shall be governed,  construed and  interpreted in accordance
with the internal laws of the State of Nevada applicable to agreements  executed
in that State.

b This Agreement  supersedes all prior agreements and  understandings  among the
parties,  and contains the full understanding of the parties hereto with respect
to the  subject  matter  hereof.  Any  change,  modification  or  waiver of this
Agreement must be in writing, signed by both parties hereto or, in the case of a
waiver, by the party waiving  compliance.  This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original. The captions of
each article and section are  intended  for  convenience  only.  All  references
herein to days,  weeks and months  shall mean by  calendar  unless  specifically
stated to the contrary.  All references herein to the singular shall include the
plural,  and all  references  to gender  shall,  as  appropriate,  include other
genders.  All  representations  and warranties  made hereunder shall survive the
execution and delivery and closing of this Agreement. At the termination of this
Agreement,  Executive  agrees  to  execute  in  recordable  form  an  instrument
sufficient to evidence said termination.

c. It is the intention of the parties hereto that this Agreement shall not inure
to the benefit of any third  parties not  parties to this  Agreement,  and it is
specifically intended that no third party beneficiary relationships, benefits or
obligations shall arise or be deemed to exist as a result of this Agreement.

d. This Agreement  shall inure to the benefit of and be binding upon each of the
parties  hereto,  their  heirs,  assigns,  successors,  executors  and  personal
representatives,  however,  as a  personal  service  contract,  it shall  not be
assignable by Executive.

e. The failure or delay by either party in any one or more  instances to enforce
one or more of the terms and  conditions  of this  Agreement  or to exercise any
right or privilege  under this Agreement  shall not thereafter be construed as a
waiver of any such  term,  condition,  right or  privilege  and the same and all
other  terms,  conditions,  rights or  privileges  under  this  Agreement  shall
continue  to remain in full force and effect as though no such  failure or delay
had occurred.






f. Any and all disputes between the parties hereto, however significant, arising
out of, relating in any way to or in connection  with this Agreement  (including
the validity,  scope, and  enforceability  of this  arbitration  clause) will be
solely settled by an arbitration  conducted in accordance  with the rules of the
American Arbitration Association or any similar successor body before a panel of
three arbitrators.  Each party shall appoint one arbitrator. If a party fails to
nominate an arbitrator within 10 days from the date when the claimant's  request
for  arbitration  has been  communicated  to the  other  party in  writing,  the
appointment  shall be made within 10 days  thereof by the  American  Arbitration
Association.  The two  arbitrators so appointed  shall attempt to agree upon the
third arbitrator to act as chairman. If the two arbitrators fail to nominate the
chairman  within 10 days  from the date of  appointment  of the later  appointed
arbitrator,  the  chairman  shall be  selected  within  10 days  thereof  by the
American Arbitration Association. The arbitration shall be conducted with a view
to  commencing  proceedings  within 30 days  from the date  when the  claimant's
request for  arbitration  was  communicated to the other party in writing and to
rendering  the award or other  judgment  not more than 15 days  thereafter.  The
award or other judgment of the arbitrators shall be final, and the parties agree
to waive their right to any form of appeal,  to the greatest  extent  allowed by
law,  and to share  equally the fees and expenses of the  arbitrators.  Judgment
upon  any  award  of  the  arbitrators  may  be  entered  in  any  court  having
jurisdiction  or  application  may be  made  to  such  court  for  the  judicial
acceptance of the award and for order of enforcement.  Such arbitration shall be
held only in Las Vegas, Nevada.  Pending resolution of the dispute,  there shall
be no  stoppage  by either  party under the terms  hereof;  rather,  the parties
hereto shall perform diligently under this Agreement pending ultimate resolution
of the dispute. By agreeing to arbitration,  neither party hereto is waiving any
benefit of any statute of limitations or other equitable defenses.

g. No  voluntary  or  involuntary  successor  in interest  of the Company  shall
acquire any rights or powers under this Agreement,  except as  specifically  set
forth  herein.  Otherwise,  the Company shall not assign all or any part of this
Agreement.






13. Notices. All notices, requests, demands, directions and other communications
provided for hereunder shall be in writing and delivered personally or mailed by
certified  or  registered  mail,  return  receipt  requested,  to the  following
addresses  for each party during the Term or until such time as written  notice,
as provided hereby, of a change of address to be used thereafter is given to the
other party, with copies to such legal counsel as each party, from time to time,
may designate:

Company                                                Executive

RIVIERA HOLDINGS CORPORATION                           Ronald Johnson
2901 Las Vegas Blvd. So.                               2901 Las Vegas Blvd. So.
Las Vegas, Nevada  89109                               Las Vegas, Nevada  89109
Attn.:  William L. Westerman, Chief                    PERSONAL & CONFIDENTIAL
Executive Officer

Notices  delivered  personally shall be deemed to have been given upon delivery;
notices  delivered by certified or registered  mail shall be deemed to have been
given  seventy-two  (72) hours after the date  deposited in the mail,  except as
otherwise provided herein.

14.  Government  Approvals.  Notwithstanding  any other terms and provisions set
forth in this  Agreement,  it is  understood  and agreed that the  engagement of
Executive hereunder, the obligation of the parties hereto, and the effect of the
Agreement,  shall be  subject  to the  approval  of each  and all of the  terms,
covenants and provisions of this Agreement by the Nevada Gaming  Authorities and
other Governmental Authorities from whom approval, if any, is required under the
laws of the  State  of  Nevada,  the  County  of  Clark,  or any  and all  other
governmental agencies having jurisdiction thereover.  Each of the parties hereby
covenant  and agree to  exercise  their  best good  faith  efforts to proceed to
obtain any and all such necessary approvals.




IN WITNESS WHEREOF,  the parties herein have entered into this Agreement the day
and year first above mentioned.

COMPANY:                                                    EXECUTIVE:

RIVIERA HOLDINGS CORPORATION

By:  /s/                                                     /s/
       William L. Westerman                                 Ronald Johnson

Its:  Chief Executive Officer


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* Krohn and Vannucci in the case of Johnson
  Vannucci and Johnson in the case of Krohn.
  Johnson and Krohn in the case of Vannucci.