The Ministerial Order providing for a 40-hour work-week and a minimum wage of $35 000 conflicts with other laws, may be illegal and should be repealed, former Chief Labour Officer Mohamed Akeel has said.
The National Minimum Wage For Regular Working Hours (For All Workers in Guyana) Order No 5 of 2013 was signed by the Minister of Labour and came into effect on July1.
In a letter in yesterday’s Stabroek News, Akeel identified several flaws and deficiencies in the Order and said that if government agrees with his findings, they should repeal the Order and have one done professionally.
“I trust that the Chief Labour Officer will clarify the concerns raised or, better still, if government find my interpretation of the law accurate and the anomalies/errors genuine that they repeal the order and make another order, done professionally, taking all views into consideration as I have been advised by members of the PSC, GMA, the Chambers of Commerce, etc, that their organisations were not consulted but rather that CAGI, which does not represent them, pushed for the order,” he said.
Concerns about the new minimum wage and work hours have been raised by several private sector organizations but government has maintained that the decision is justified particularly given the many Guyanese who have complained about being overworked with little financial compensation.
Attempts yesterday to get a response to Akeel’s statements from the current Chief Labour Officer Charles Ogle were futile though he said the claims would be addressed by the ministry in a statement that will be released early next week.
Ogle had previously said that rest and a “livable” salary are the principle factors which inform the order.
He had said that the government will continue to stand by the order, and would penalise employers who refused to comply with its provisions.
Attempts to get a response from Minister of Labour Nanda Gopaul yesterday afternoon were also unsuccessful as when reached, he said that he was driving and could not speak. The minister asked to be re-contacted in an hour but all subsequent attempts to contact him were futile.
Highlighting exactly where the government may have went wrong, Akeel stated the procedure used to birth the Order was not consistent with the Act under which it were made and this could impact on its legality. He pointed out that the Order was made under Section 8 of the Labour Act, Cap 98:01, which requires that certain procedures be followed before the minister can make an order.
“I don’t think those procedures were observed,” Akeel said. He pointed out that under Section 8, the minister, if he deems it expedient to regulate the wages paid in any occupation in Guyana, may appoint an advisory committee to investigate and make recommendations as to the minimum rates which should be payable.
On considering the recommendations of the committee, Akeel said, “the ministry may, subject to negative resolution of the National Assembly, make an order prescribing the minimum rates.” Akeel added that before making the order the minister is required to publish his intention to make the order, the places where copies of the order can be obtained, as well as the time within which any objection with respect to the draft order must be sent to the minister. There are other procedures necessary if there is any objection.
In his letter Akeel argued that if these procedures were not followed by the minister in his bid to create the order, “it “may not stand if challenged in a court of law.”
He said that the procedures followed by the minister would have been allowable under Section 9A of the Labour Act since the section allows the minister to make an order without appointing an advisory committee or going through the abovementioned procedures.
Another flaw, he said, was the fact that the order prescribes a 40-hour, five-day work week. “Hours of work cannot be prescribed under Section 8 or by an order. It has to be done be regulation made under Section 28 of the Act,” Akeel wrote.
The former CLO said that this is the section which gives the minister the authority to create regulations which dictate the amount of hours an employee may normally work in any week or on any day in any occupation. “This may be another ground for the order to be null and void,” he said.
Akeel recalled that in the matter of the Labour (Amendment) Act, 1984, between the Attorney General and Mohamed Ali et al, the Chancellor, K S Massiah said that the Minister (Labour) caused Parliament to be in breach of the constitution. “Was the National Assembly caused to be in breach of the law in the instant case since it approved the Order by negative resolution,” he questioned.
“As Chief Labour Officer I held, along with my deputy, Dhanraj Sookdeo, a number of consultations with stakeholders on the question of a national minimum wage but we could not find a realistic formula,” Akeel recounted.
He further argued that a national minimum wage with a 5-day work week could be self-defeating. “Can a developing country afford to have the wheels of production going for five days or in-crease cost of production by overtime payment and risk limiting the access to overseas markets?” he asked.
“My observation must not be seen as being anti-worker or controversial, for the intent of the order is laudable and government must be commended for having the political will, but rather is intended to point out some of its implications and deficiencies,” the former CLO added.
Meantime, Akeel said that capital flight may occur due to the resulting increase in costs of operation.
“Companies with contractual obligations such as garment factories that manufacture clothing for US companies may be negatively affected. US companies use companies here to manufacture because of low production cost. If the cost goes up or delivery dates are not met they may very well move their business to Asia and other countries where costs are lower; hundreds of workers, mostly females, can be on the breadline,” he said while adding that some Caribbean islands have free zones to facilitate employment.
The former CLO further said that the Order disturbs the differential between categories of workers in the sectoral minimum wage orders made by the minister in 2012 since it prescribes that the minimum wage be paid to every person employed in Guyana, whether daily, weekly, or monthly paid and states that where a person is in receipt of a higher rate, that rate shall continue to be paid. As such, he said, “a labourer and a sales representative will now receive the same wage.”
Trainee’s, Akeel said, were not excluded from provisions under the Order, and he questioned if trainee nurses would now be paid $35,000 monthly since these were not explicitly explained. He also noted that some sectoral minimum wage orders now makes provisions for a worker to be paid for an entire week, regardless of whether or not he worked the entire week. “He can be paid for days worked based on the following calculation: Mini-mum rate divided by 6 plus 25 per cent of such lesser rate,” Akeel said. “With the work week now being five days I respectfully submit that those orders should have been amended to reflect the new number, or the instant order could have had a clause saying so or those clauses could have been repealed as they might no longer be relevant.
This anomaly needs to be corrected,” he said.
Apart from the more technical issues, the order will place a substantially larger financial burden on the shoulders of employers, especially small business owners who might not be able to afford the increased payment, the former CLO said.
He further pointed out that Clause 5 of the Order states “any hours of work [should be ‘hours worked’] beyond the normal hours shall at a minimum be paid at the rates set out in the Labour (Conditions of Employment of Certain Workers) Act, No 18 of 1978, the Factories Act [should be Factories (Hours and Holidays) Act] Cap. 95:02, or any other law or any collective bargaining agreement in force.” But there is no longer a Factories Act, Akeel said.
“The Order conflicts also with other laws including the Factories (Hours and Holidays) Act that provides for overtime to be paid after 8 hours per day; the order requires overtime to be paid after 40 hours per week. The order cannot supersede the law. How would payment for the 6th day be calculated? Employers affected are required to obey the law as well as the Order. How?” he questioned.
He also pointed out other complications. “Single parents, who are security guards, nurses, etc, who earn the minimum wage or a little above and have to work at nights and employ persons to take care of their elderly parents or children have to pay those persons the minimum wage, what they themselves earn plus find money to travel. So, they either leave the job and become a burden on the social system, or leave the children alone at home and pray they don’t play with matches,” Akeel said.
