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Minimum Wage Not On Agenda - It Is Now: $300 A Week

Obie Ferguson, President of the Trade Union Congress.

Obie Ferguson, President of the Trade Union Congress.

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Trade union leaders want a minimum wage increase to between $250-$300 per week, and are pushing for the issue to be formally discussed by the National Tripartite Council.

Obie Ferguson, the Trades Union Congress (TUC) president, told Tribune Business that such a rise was justified by persistent cost of living increases that had been further exacerbated by the VAT rate hike to 12 percent.

Branding the existing $210 weekly rate as “inadequate” for the “average” Bahamian household, Mr Ferguson argued that his proposed increase of between 19 percent to 43 percent would not be too burdensome for Bahamian businesses to absorb because most were “doing well”.

He conceded, though, that a minimum wage rise ought to be accompanied by the very productivity initiatives that the National Tripartite Council is currently focused on.

Meanwhile, Mr Ferguson’s counterpart, National Congress of Trade Unions (NCTU) president, Bernard Evans, told this newspaper that the group’s representative on the National Tripartite Council has been instructed to push for a formal discussion on a minimum wage increase.

Warning of increasing income inequality and a shrinking middle class without an economic rebalancing, Mr Evans warned that Bahamian society was in danger of splitting into “two classes - the haves and the have nots”.

Still, Mr Ferguson indicated that the TUC and its affiliates were prepared to moderate their demands slightly compared to their previous calls for the minimum wage to be raised to between $300 and $350 per week.

“I think it is clear that the TUC and the affiliates are in support of an increase in what I consider a liveable wage, even though it’s referred to as a minimum wage,” he said. “Two hundred and ten dollars per week is certainly not adequate.

“At one point we had proposed increasing it to $300 to $350 a week. I think a $250 minimum to $300 would be a reasonable figure for the average household. I think that’s reasonable having regard for the cost of living, having regard for the economic situation, and it would not be too onerous on companies because most are doing well from what I’ve been led to believe.”

Mr Ferguson said he understood that while a minimum wage rise may have been discussed informally, both within the Government and at the National Tripartite Council, he was “not convinced there was a formal agenda item” as the trade union movement had not been asked to present its formal position on the matter.

“We’ve been seeking over the last couple of years for that to become an agenda issue, and look at the situation for what it was,” the TUC chief added. “The increase in VAT has really impacted that proposition and given reason for it to be supported by us with the request we’re making.

“The cost of living has gone up, rental rates have gone up, and all those things impact pay. If you look at a cost benefit analysis into all these variables, it does justify what I call a nominal increase. An $250-$300 weekly minimum wage is well within range.”

The first, and last, increase in the minimum wage occurred in mid-2015 in a bid to cushion the impact of Value-Added Tax’s (VAT) introduction - and associated cost of living increases - on low income earners.

The 40 percent rise to $210 per week was the first such occurrence since the minimum wage was introduced by law in The Bahamas in 2002. Pressure for further increases has come at regular intervals due to The Bahamas’ economic difficulties over the past decade, especially when factors such as the VAT rate rise to 12 percent reduce household purchasing power.

Many Bahamians argue that $210 per week, or $840 per month, is not a “liveable” wage and it is impossible to make ends meet with such an income - especially if the worker has a family to support - given the constant rise in the cost of living.

However, minimum wage increases come with other consequences. They inevitably increase employer costs, which can result in companies laying-off staff or becoming reluctant to take on new hires.

Given that those earning minimum wage salaries tend to be young workers, such as school leavers, just entering the workforce, any reluctance by employers to hire at an increased salary could create barriers to entering the world of work. There is also a social cost to this, as young, unskilled minimum wage earners are often those responsible for the current level of crime.

Companies could also choose to pass increased minimum wage costs on to consumers, raising the cost of living, while any increase in salary at the workforce’s lower end can result in greater expectations for a rise among higher-salaried workers - leading to cost-push inflation.

Mr Ferguson, though, was backed by his fellow trade union leader, Mr Evans, who said the NCTU had “instructed our representative to push and make a minimum wage increase an agenda item for the next meeting” of the National Tripartite Council, which is the body that deals with all workplace, industrial relations and labour matters.

The NCTU president, who last week described $450-$460 per week as a “liveable wage” in The Bahamas, said an increased minimum wage was an essential component in any strategy to fight widening income inequality in The Bahamas.

“We have to address it in a meaningful way; we can’t keep listening to Standard & Poor’s (S&P),” Mr Evans argued. “We have to present solutions to close that gap, put in place policies that expand the middle class. You can’t have policies that continually squeeze the middle class and widen the income gap.

“Whatever trajectory we’re on it’s the wrong trajectory. Your policies should be based around shoring up the middle class, and putting money in the hands of the less fortunate who have fallen below the poverty line. That’s why we keep focusing on the minimum wage, a liveable wage.

“We can’t keep doing business as usual when every study shows the poor are getting poorer and the rich are getting richer. If we don’t recognise that as a people we’re on the precipice of collapse, and will become a country of two classes: Those that have, and those that don’t.”

Mr Ferguson, meanwhile, agreed that a minimum wage increase ought to be accompanied by greater productivity, given that this was one way workers can access higher salaries and greater benefits from employers.

“We’re very supportive of productivity,” he said. “That’s been our position from the time of the late Reginald Lobosky. I worked out the first productivity agreement with Reg Lobosky. The workers do better with a productive company in terms of their wages, and it’s good for the economy as well.”

Comments

Chucky 1 month, 4 weeks ago

Society been ever split into haves and have nots

@ 840 a Month it’s not even what the “haves” spend a month on eating out.

Those that are doing well are spending 10k plus per month, just on costs, some spend that on rent alone.

This is a well established and perfected system of modern day slavery.

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Well_mudda_take_sic 1 month, 4 weeks ago

Our nation's political history since 1973 is replete with countless instances of betrayal by corrupt politicians and their cronies who have sold our country's natural assets (our heritage) to the very wealthy few among us and foreign corporate interests. Our corrupt ruling political elite with their grandiose sense of self-entitlement and distorted value system remain entrenched in political parties that thrive on E - educated voters, many of whom came to our shores as illegal aliens but somehow managed to obtain Bahamian citizenship. The vast majority of easily manipulated dumb voters are just too stupid to realize that the corrupt political elite promise them everything come election time and give them absolutely nothing (in fact take from them) the rest of the time. As you put it Chucky: "This is a well established and perfected system of modern day slavery."

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Porcupine 1 month, 3 weeks ago

Agree with both comments above.

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SP 1 month, 4 weeks ago

How the hell does a person live on $210.00 per week? Even the proposed $250-$300 per week is not a livable wage in this country!

Every time I hear people commenting that Bahamians steal too much, I wish they would put themselves in the average Bahamians shoes and try to figure out how to survive on $250.00 per week. I certainly couldn't do it and wouldn't want to try!

It is unfair and hypocritical to grossly underpay people, forcing them to supplement income by stealing to survive meagerly, then condemn them for stealing.

Business owners are the real thieves with their huge houses, rental apartments, high-end cars, yachts, and expensive clothing, and excessive travel are the real culprits stealing from the staff by underpaying them to support lavish lifstyles!

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Well_mudda_take_sic 1 month, 4 weeks ago

Most business owners who are not somehow tied to the corrupt political elite are struggling to survive. All of the big time tiefin' is actually being done by foreign interests with the help of our corrupt politicians and their select few business cronies. Between what the foreign corporate interests are given by our corrupt elected officials and what these same corrupt politicians take or skim off for themselves and their family members and local cronies, there is very little if anything left for the Bahamian people, except of course the national debt and unfunded retirement plans, and a bankrupt national insurance scheme. That's the harsh reality.

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Chucky 1 month, 4 weeks ago

I’d say we have our fair share of Bahamian thieves. Look at our large contractors. How bout the big stores.

At least the foreign thieves come here and pay well. Ie banks, developers etc

Our thieves are not happy just tieffin the gotta starve their people too.

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John 1 month, 3 weeks ago

Obviously those who commented above SP and those who responded Chucky and 'da jackrabbi",t are not aware or ignorant of the intent of minimum wage. Minimum wage is not to drive the wages in the market but to set a comfortable level at which new workers can be paid when they enter the market. The market drives wages, and unfortunately, because of the high cost of doing business in the Bahamas, including high taxes and utilities along with a depressed economy, many find that the minimum wage is the going rate for most labor intense jobs in the market. This includes store clerks, warehouse personnel, gardeners (some) and maids (some). Many find that to currently climb above the minimum wage, one has to get a job with more responsiblites. But, of course persons who have qualifications beyone high school should have no issue with minimum wage as their starting salary should be at least $100.00 above it. Some may argue that one cannot live on a minimum wage of $210 per week. Well most people who are starting out in the work field do not live alone and neither are they the head of a household or major bread winner. ANd when a persons finds him or herself in a situation that they need additional money but cant raise above the minimum wage, then the options are to work overtime or find a second part time job. That is how their parents and grand parents made ends meet. When wages and salaries are increased with no corresponding increase in sales or income for a business, then the only option is for the business to raise prices. And if prices are increased corresponding to the wage increase, then there is no financial benefit to the worker. He is taking home more py, but has to spend more to maintain his same standard of living.

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Islandboy242242 1 month, 4 weeks ago

It doesn't always end well. Minimum wage goes up and so does the cost of everything else. https://www.cbc.ca/news/canada/toront...">https://www.cbc.ca/news/canada/toront...

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DDK 1 month, 4 weeks ago

Let the Government, their cronies and the numbers houses subsidize the minimum wage if an increase is deemed necessary. There soon won't be any jobs on offer by the average Bahamian business, most of which are struggling to keep their doors open, having been taxed to death by successive Bahamas Governments and having been crippled by high global prices to boot. The economy is stagnant and a further recession is looming These greedy unionists do not care one iota about the survival of business, only lining their own pockets and paying lip service to those they represent, much like Government.

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TheMadHatter 1 month, 4 weeks ago

If government would take their grubby fingers out of Freeport and allow it to grow ... wages would go up naturally due to insufficient persons available to fill open jobs.
How about the Mud and Peas? They still going strong destroying the lives of Bahamians. Forcing a minimum wage increase will not help....except for maybe 6 weeks.

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joeblow 1 month, 3 weeks ago

While $210 is quite a low pay scale, qualified people will not work for it and many others who do work for it are overpaid. Just visit a business where you have entry level workers including fast food places and you can see that they should be the one's paying their employers for giving them an opportunity to work.

Secondly, a price wage increase will force layoff in low paying jobs. Its better for a business person to let one employee go and divide that salary between workers left while trying to improve productivity!

Lastly, if we can get our people to take advantage of their high school education, learn some manners, stop teiffin' your bosses time and goods and stop having children without higher level education, employers might be willing to pay a little bit more without being forced by government!

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DDK 1 month, 3 weeks ago

Quite right, and I think many are forgetting that minimum wage is just that, MINIMUM wage, which matches experience and qualification and is NOT the be all and end all of paid wages.. ...

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John 1 month, 3 weeks ago

Obviously this is just to excite emotions and rile up workers to false expectations. And unions are famous for doing this to garner support. Of course government is entertaining this idea right now because they know the disaster the 12% vat increase has created. Minimum wage was increased by 60 % just recently and to increase another 45% would double the minimum wage in less than ten years. The average increase in salaries and wages is under 10%.

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John 1 month, 3 weeks ago

Should read: "Of Course government is NOT entertaining this idea right now..."

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ABOMINATION 1 month, 3 weeks ago

Well said contributors to this article.

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juju 1 month, 3 weeks ago

With a min wage increase, will the quality of work go up also? I fear NOT... Not to be cynical, but the increase in min wage will probably mean more profit for the numbers boys.... might they be pushing this??

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Porcupine 1 month, 3 weeks ago

Interesting comment juju. Start by eliminating the numbers houses and their political power and the people may have a fighting chance.

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Well_mudda_take_sic 1 month, 3 weeks ago

That gets a very big "ditto" from me, but that low-life criminal thug (Sebas Bastian) has the Minnis-led FNM government on his 'payroll'.

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Porcupine 1 month, 3 weeks ago

Most very rich people have most politicians on their payroll.

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Schemer18 1 month, 3 weeks ago

"Mr Ferguson said he understood that while a minimum wage rise may have been discussed informally, both within the Government and at the National Tripartite Council, he was “not convinced there was a formal agenda item” as the trade union movement had not been asked to present its formal position on the matter."

These Unionist are so weak, & how come they are not a part of bringing forth the rights of their members to the government?

I do not trust this National Tripartite Council it is in the interest of gaining not to elevate the young Bahamians in our society.

I have heard a lot of those National Tripartite Council members rising up here in the Bahamas, who came from foreign countries like a Peter Gourdi - Canada does he know what is Bahamian like our forefathers knew?

STAND UP BAHAMIANS, STAND UP THIS IS YOUR LAND NOT THEIRS!!!

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truetruebahamian 1 month, 3 weeks ago

Of course he does. He has been here and married to a Bahamian lady for more years than you probably have under your belt.

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