Minimum wage before 09 election

The People’s Progressive Movement Government will make changes to the Labour Law – including the introduction of a minimum wage – before the 2009 election, Cabinet Minister Alden McLaughlin has said.


Mr. Mclaughlin

The Minister responsible for employment, speaking after the draft National Assessment of Living Conditions report last week, became the latest voice to call for a minimum wage in Cayman.

‘I am still committed to making a number of changes to the present Labour Law, which is now 20 odd years old. The introduction of a minimum wage is among them,’ he said.

Other changes that will be looked at include a small reduction in the normal working week – possibly from 45 to 44 or 43 hours – and legislating to ensure employers actually pay their worker overtime at overtime rates.

While Mr. McLaughlin has previously declared himself a strong supporter of a minimum wage, he said his PPM Government has held off from taking action, partly in anticipation of the NALC report.

‘We wanted to get a better handle on what it was people needed to survive in this country,’ he said.

But, he added, ‘I would really feel that I had not discharged my duty if, at the end of this Government’s term, I had let this slide for what would be four-and-a-half years.’

While he anticipates some resistance from the business community, Mr. McLaughlin believes compromise will lead to a consensus on labour reform.

He recently had discussion with the Chamber of Commerce Council on the topic and plans to meet with the Cayman Islands Society of Human Resource Professionals in the coming weeks.

‘I believe in getting things done. Sometimes you don’t get exactly what you wanted and you don’t get it perfect the first time, but you make some progress. That’s my approach to this,’ Mr. McLaughlin said.

NALC backs base wage

Recommending the introduction of a country-wide minimum wage, the NALC report stated: ‘The absence of a minimum wage in an economy like the Cayman Islands creates conditions for open exploitation, especially of unskilled guest workers who respond to the complimentary push factors in their home country and the pull factors of the Caymanian economy.’

Speaking last week, Ralph Henry, a developmental economist with the Kairi Group of Consultants that carried out the study, sighted both the plight of poor workers – many of them immigrants – and the need to integrate more Caymanians into the workforce as two compelling reasons for a minimum wage.

‘If you establish a floor below which you will not go, it means that you will force employers to look at other ways of organising production and not depend on the lowest quality and the lowest level of labour that can be sourced in the international community and the regional economy,’ Mr. Henry said.

Setting a minimum wage would also help move some Caymanians off welfare and into the workforce, Mr. Henry argued.

‘The reservation wage amongst Caymanians is much higher than is paid by the employers … and clearly some are prepared to put their pride aside and go to the welfare department … rather than work at wages they regard as sub-normal,’ he said.

Mr. McLaughlin broadly agreed with Mr. Henry’s assessment. He pointed to documented cases where people in Cayman have been paid as little as $2.90 per hour, saying ‘most Caymanians won’t live in those conditions and most Caymanians won’t work for those paltry sums.’

He described as ‘inhumane’, some of the low wages immigrant workers get, but he argued a minimum wage would benefit Caymanians.

‘Even if one were to be completely selfish about the issue and say ‘we are only going to care about Caymanians’, it is adversely affecting Caymanian society to have people that are earning less than is necessary to keep body and soul together.’

A growing chorus

The NALC report’s recommendation comes after a consultant’s report carried out for the Ministry of Employment in November also called for the introduction of a minimum wage.

‘Every effort must be made to avoid the perceptions of ‘importing and sustaining poverty’ by maintaining depressed wages in a first world country,’ the report, by labour and management consultant Samuel J. Goolsarran, said.

The United Church in Jamaica and the Cayman Islands went one step further last year, calling on the Government to introduce not merely a minimum wage, but a living wage.

It described the introduction of a living wage as the just and right thing to do, saying ‘you want a wage that can meet the basic needs of people, and so they can have a reasonable standard of living if they are working full time.’

The draft NALC report found 3.7 per cent of the population was living in poverty or at risk of poverty. It put the poverty line at $3,983 annually, and said people earning less than $4,979 were vulnerable to poverty.

Among the poorest 30 per cent of people living in Cayman, almost two in three were foreigners, it said.