The Cayman Islands Civil Service
Association has indicated it will not oppose government plans to cut workers’
salaries by 3.2 per cent starting in July.
However, the group’s president has
said government might consider implementing the pay cut a bit differently than
has been proposed.
According to government e-mails and
memos obtained by the Caymanian Compass last week, the across-the-board pay
reduction would affect all civil service departments, as well as some statutory
authorities and government-owned companies as of 1 July – the beginning of the
upcoming budget year.
Civil Service Association President
James Watler said that reduction means a cut in monthly pension allotments government
workers receive. Also, any older civil servants retiring under the defined
benefit pension system next year would end up taking a lower monthly pension
payment, since their final pensions are based on their last month’s salary
Both situations could be avoided,
Mr. Watler said, if government would implement the pay cut as a furlough –
essentially giving government employees unpaid days off.
This would allow those workers to
keep both their current pay grade, as well as any pension payments, he said.
Civil servants would likely have to take four or five days off for the year to
make the 3.2 per cent pay cut.
“Taking unpaid leave would help
protect pensions and it would not have a direct impact on civil servants’
salary grades,” Mr. Watler said. “We urge government to consider this option.”
As far as the pay cut itself, Mr.
Watler said the idea was actually suggested earlier this year by the association,
although they proposed it only as a temporary measure.
“The Civil Service Association has
always stepped up to the plate when called upon to do so,” Mr. Watler said.
Other budget cutting measures set
out in an administrative circular from the Portfolio of Internal and External
Affairs Chief Officer Franz Manderson last week included a restriction on government
hiring and a 10 per cent cut in government payments to the Cayman Islands National
Insurance Company for health care premiums.
Mr. Manderson said those reductions
would not affect the cost of health care premiums, which are all paid by government
and are not taken out of workers’ salaries. He said CINICO, which was expected
to report a profit this year, would simply eat the extra 10 per cent cost.
CINICO was created by the Cayman Islands government earlier this decade and its
board is appointed by the government.
Government departments will also
restrict hiring in civil service departments to 25 per cent of those positions
initially requested in a draft budget proposed in February, unless additional
hiring is approved by Cabinet members. Government has been operating under a
“soft” hiring freeze since late 2008.