Govt eyes hike in minimum wage

The Nassau Guardian

Govt eyes hike in minimum wage

Despite the lack of consensus from the business community, the government will consider proposals for a “much needed” increase to the national minimum wage by the end of the year, Minister of Labour and National Insurance Shane Gibson said.

The minimum wage for public sector employees is $210 per week while the minimum wage for private sector employees is $150 per week.

Gibson spoke to The Nassau Guardian yesterday following an announcement on Friday that he has invited the government’s social partners to submit their recommendations for a wage increase.

Gibson made the announcement as he delivered his national address on Labour Day.

“It is my hope that the much needed increase in the minimum wage will contribute to the further economic development of Bahamian workers,” he said.

When contacted yesterday, Gibson declined to say what he thinks would be a fair increase. He said he will wait for the consultation process to conclude and the government will make a decision then.

However, he noted that some employers have tried to stall the process for various reasons.

"You can never get the employers to agree on an appropriate time for a wage increase," he said.

"They never think it’s an appropriate time. So we just have to get together and agree on a date and the increase."

While the news of a possible wage increase is expected to be celebrated by union leaders, some in the business community will likely object to the plan.

Fatal mixture

Sky Bahamas owner Captain Randy Butler said businesses cannot afford to take on additional expenses in the current economic climate.

“Let’s analyze this,” he said yesterday. “Did the [government] look at this from the business view or is it going for political expedience to get them elected again?

“We’re talking about adding value added-tax (VAT) on top of [limited] customs reductions and mandatory increased salaries. It’s a fatal mixture for businesses in the country.

“Those in business now are saying, what in the world are we doing.”

Butler said he pays his employers above the minimum wage, and added that the government should increase the salaries in the public sector before it asks anyone else to do so.

“They’re the ones that seem to be in dire trouble with the unions,” he said. “It’s not the private sector that’s having the challenges.”

Several union leaders have called for wage increases recently.

Bahamas Public Services Union (BPSU) President John Pinder wants the government to raise the minimum wage ahead of the implementation of VAT.

Pinder said he does not think the government understands the impact that VAT will have on low-income families in the country.

The government will implement VAT at a rate of 7.5 percent on January 1, 2015.

The cost of living is expected to increase by four percent after the implementation of VAT, government officials estimate.

Last week, Trade Union Congress (TUC) President Obie Ferguson said the country’s minimum wage is simply unacceptable.

“One hundred and fifty dollars a week can not be accepted in this Bahamas today,” Ferguson said.

“…These are burning issues. These are issues that affect the average Bahamian.”

Gibson said last year that he expects the Minimum Wage Act to be amended following the establishment of the National Tripartite Council, which links labor unions, employers and government.

The council held its first informal meeting last month.

Gibson said the council will also submit recommendations to the government to amend the Industrial Relations Act 1970 and the Employment Act 2001.

“These amendments will propose increases in the statutory redundancy and severance entitlements, clarification on the definition of a lunch break, overtime entitlement, and minimum time limits for employers to enter into good faith negotiations with the recognized bargaining units,” he said during his national address.

 

 

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