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‘Firms Haven’T Got Money For Severance Payments’

LABOUR Director John Pinder.

LABOUR Director John Pinder.

By RASHAD ROLLE

Tribune Senior Reporter

rrolle@tribunemedia.net

LABOUR Director John Pinder said most employers do not have sufficient revenue to give severance packages to their employees if the government declines to extend its unemployment benefits programme.

The social assistance programme expires at the end of this month - as does the grace period in which employers can refrain from paying their employees and avoid letting them go in accordance with the Employment Act.

Financial Secretary Marlon Johnson said yesterday officials are still considering whether to extend the unemployment benefits. It is not clear if the government will extend the grace period provision beyond this month.

Mr Pinder said yesterday: “The government is trying its best to open the economy so they don’t have to extend unemployment benefits. Most employers don’t have sufficient revenue to give separation packages at this time and they’re leaning towards wanting an extension of the programme rather than having to offer separation packages. On the other hand, there are a number of employees - like those who don’t mind retiring - that would like to get the separation package and want their companies to offer them that.”

Although the Minnis administration has begun the process of reopening the country, Mr Pinder does not expect to see a significant decline in the unemployment rate soon after the process is complete.

“Unless the airlines are flying and the cruise lines are sailing,” he said, “you can’t say those who depend on tourism unemployment benefits wouldn’t need it. Many won’t be in any position to bring on any complement of staff within the first four to eight weeks after reopening. Once tourism increases then they’ll be in a position to get the right complement of staff working, but that will take time.”

Mr Pinder said if forced to offer severance packages, many companies will go bankrupt.

“It would be comparable to the situation that happened to CLICO some years ago,” he said.

Earlier this month Deputy Prime Minister and Minister of Finance Peter Turnquest said the government has spent about $53.3 million helping unemployed people. He said in total, 35,593 people have benefited from its unemployment assistance programmes. The National Insurance Board, meanwhile, has paid out “some $93.3 million directly to its beneficiaries,” he said.

Comments

themessenger 3 weeks, 3 days ago

And the Government doesn't have the money to extend the unemployment benefits indefinitely either Mr. Pinder. And they're already bankrupt!

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hrysippus 3 weeks, 3 days ago

Soneone call me out if I am wrong in thinking that Mr. John Pinder has never owned or operated a business in the Bahamas. He has never hired an employee onto the payroll of a business yet here he is the expert on Bahamian private businesses and their employees. How can his pronouncements be taken seriously?

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Dawes 3 weeks, 3 days ago

Whether that is true or not what he is saying is true. Not many companies will ahve the funds to layoff 50% or more of their workforce if needed. So instead of saving the people they can and then hoping to grow back to where they were they will have no choice but to declare bankruptcy and then no one gets paid (and employees go to second bottom of the payout line). Government should consider extending it or amending the severance law whereby companies can defer payment for up to 5 years, with yearly payments (and even consider saying if the person gets a new job then the amount outstanding is got rid of). These events will probably speed up the process of more and more workers being hired as contractors so the company doesn't have the liability at the end.

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Davey543 3 weeks, 2 days ago

Why would our government make a move that is anti its people and pro private businesses and where would this money come from to extend this lay off period and what amount becausd the current 150 a week will leave people homeless

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Dawes 3 weeks ago

Because the cost in the long term from multiple companies going bankrupt trying to pay the severance to those they would need to let go in order to survive will be much worse then carrying on the $150 per week right now.

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regrolli 3 weeks, 3 days ago

Finally someone figured it out. Just when a company needs cash to survive, the biased, out dated and inequitable, employment act rears it’s ugly head. The very piece of legislation that was designed to protect workers will deal the final blow; company bankrupt and employee on the street with no income and no severance. And where are the unions with all their dues payments? Aren’t the monies meant to be saved to assist members in their time of need? Unions are notable by their silence.

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benniesun 3 weeks, 3 days ago

Like I have stated before:

  • no one knows when or if the worldwide lockdown will end

  • the unrest in the usa is projected to ramp up to November and worsen after their election and into 2021. Some say normality will "begin" to return there in September 2021

  • even the best case scenario confines us to our present financial position for another year

Our government should have already cut all salaries from March of this year. Maslow's Hierarchy of Needs puts the need for food and housing on the first tier. Without these basic essentials there will be a complete breakdown of society - riots, maraudings, and other undesired acts. I have repeatedly written that this country is on the verge of starvation - but I see no significant actions being taken. The government cannot continue to throw what little monies we have left after wishful thinking and unrealistic expectations.

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themessenger 3 weeks, 3 days ago

@benniesun, what you saying bey? You ain see BAMSI dem giving out cassava sticks an sweet potato slips for we peeps to grow in da yard? Lol.

On a more serious note though, you are absolutely correct about the effect wide spread hunger would have on social behaviour, we're not far from it now, scary.

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TalRussell 3 weeks, 3 days ago

It shouldn't be the blanket responsibility PopoulacesPurse to rescue the hard straight-up truth that for 40 out of 100 businesses it is unlikely that they will be able to keep their doors open as the economic blow from COVID-19 plays out. Some were done on the financial ropes even before the virus made landfall. Shakehead once for Yeah business owners who so hate thought universal BahamaHealthCARE for all, along with social programs, is first to seek PopoulacesPurse corporate handouts, including not submitting employee national insurance. and extended health care premiums deductions Twice for Not?

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