While the business community foresees a range of difficulties in the implementation of the new national minimum wage and the five-day work week from tomorrow, Minister of Labour Dr Nanda Gopaul says government will not yield to calls to delay the start date since there was enough notice of the impending changes.
The new minimum wage is $35,000 per month and the new working hours are from Monday to Friday, following the tabling of an Order in the National Assembly. The increase is expected to benefit some 31,000 workers.
Under the new minimum wage, no worker should be paid less than $202 per hour, $1,616 per day, $8,080 per week, or $35,000 per month. Any work outside of the 40 hours in a five-day work week will necessitate payment of overtime.
Speaking to Stabroek News, Chairman of the Private Sector Commission (PSC) Ron Webster said that while the members of the PSC do not have a problem with the 40-hour work week or the increased minimum wage per se, they have a problem with compressing six working days into five. “The garment industry is already complaining that they already have a narrow margin,” he said.
According to Webster, the Consultative Association of Guyanese Industry (CAGI) is looking at ways in which productivity could be increased in spite of the new regulations. “Generally there is no problem with a five-day work week. But if you have shift operations, it could be difficult,” said Webster. He said too that the new regulations could be problematic for manufacturers with price contracts since it could take those businesses some time to adjust. “Food products could be affected,” Webster said. “The way the work is scheduled means that you cannot compress [a whole day’s work into eight hours],” he added.
He said that the PSC will continue to have meetings among its members and with government on the new regulations and their implications for business and the private sector.
“It is not as simple as it appears… there will be problems for shops, stores and those in the garment and agriculture sectors,” he said. “These are hurdles which we will have to look at to see how we could come up with answers,” he said.
President of the Georgetown Chamber of Commerce and Industry (GCCI) Clinton Urling said that the Chamber and its members are ready to implement the new minimum wage order from July 1. Further, the Chamber will be hosting sensitisation sessions in collaboration with the Ministry of Labour on the applicability of the new order, he noted.
“The minimum wage increase is a welcomed development for all Guyana. It ensures that employees are more adequately compensated for their efforts and it also increases their ability to meet their monthly expenses and also increases their ability to make purchases that they desire,” he said.
“The only issue raised by a number of our members on this issue is the fact that the 40 hours would have to be confined to a five-day work week, as opposed to six days. This situation would mean that some businesses would have to pay increased salaries and hire more employees in some cases,” said Urling.
“This increases the risk that some business would increase prices for their goods and services to offset the higher costs and this could contribute to some inflationary pressures,” he said. “The Chamber would like to see the Labour Ministry conduct an empirical examination of this move to assess the economic impact on businesses and the economy as a whole,” he said.
Minister Gopaul, however, said that those criticising the development had plenty of time to prepare themselves. “We are not prepared to budge…there has been long notice given…we believe that if they programme their work properly, they could do it with no additional cost,” he said. “You can have staggered staff [or] you could give workers two days off,” he suggested.
Dr Gopaul said the Tripartite Committee comprising government, private sector and labour, met over one year ago and agreed that these changes were to take effect. According to the minister, during his Labour Day parade speech on May 1, 2013, at the Critchlow Labour College, he mentioned that these changes were imminent. He said President Donald Ramotar spoke about the changes as had he himself in the National Assembly earlier in the year. “I gave them the assurance that they could flex. It could be any five days out of seven,” he said.
Writing in a letter to this newspaper on June 22, 2013, Christopher Thompson, Director of Operations at Sentinel Security Inc. suggested that Minister Gopaul review his decision and amend the implementation date “to afford reasonable time and space to accommodate this new demand on security firms and other businesses.”
He said that while there is no disagreement with the new minimum wage thus far, “why the rush to implement? Why not invite consultations with security firms to afford a better appreciation before pronouncing on the implementation date definitively?”