The proposal for Cayman’s first minimum wage is now in the hands of the members of the Legislative Assembly. The premier, delivering his policy statement last week, said Cabinet had accepted the report and the $6 an hour minimum wage proposal, and called on the elected members to make the necessary legal changes.
If approved, the new minimum wage would go into effect on March 1, 2016. The proposal makes an exception for employees who receive tips or room and board, essentially setting a $4.50 an hour minimum wage for people in the service industry and for domestic workers.
Premier Alden McLaughlin, speaking at the beginning of the new legislative session Friday, said he was committed to enacting a minimum wage. “This was a key plank in the Progressives’ manifesto and we look forward to seeing it move to completion,” he said.
Enacting a minimum wage will require several legal changes, mainly to the Labour Law. The Minimum Wage Advisory Committee report, released in February, details changes to seven sections in the Labour Law, including setting the wage, requiring more record keeping by employers, increasing fines for Labour Law violations, and expanding the definition of “workplace” to include households employing domestic workers and make the law applicable to nonprofit and charitable organizations.
The report also recommends a series of other changes to labor and immigration laws to strengthen the minimum wage, such as instituting whistle-blower protection to shield people who complain about Labour Law violations, and requiring every employer to make formal contracts with employees and include those in work permit applications.
Committee Chair Lemuel Hurlston, who led the year-long study on wages in Cayman, said he expects the minimum wage proposal to come into the debate as elected leaders go through the budget later this week or early next week. “I don’t think this will be hugely politically controversial,” he said.
Mr. Hurlston said the minimum wage would have a small impact on the government budget and, he added, “won’t substantially impact the economy.”
The report estimates the new minimum wage regime would result in up to 600 job losses, mostly non-Caymanian domestic workers.
The challenge for the committee, Mr. Hurlston said, was “the question of arriving at a fair balance.” Committee members had to weigh economic impacts and protecting workers to make sure they didn’t set the wage level too high or too low.
Assuming the $6 an hour wage is passed, Mr. Hurlston said, continued assessment and monitoring will be essential to make sure the wage level stays relevant and keeps pace with inflation and the labor market. The report lays out processes for an annual review by government, and a full review by the Minimum Wage Advisory Committee every four years.
Assuming a majority in the Legislative Assembly supports the $6 an hour minimum wage, they will have 10 months to get everything in order if they want to meet the premier’s March 1 deadline next year.
Mr. McLaughlin told legislators Friday, “The time in the interim will be used to not only prepare and educate the public, but also make legislative and other changes that will be required.”