Newsmaker… Week: Mixed views on increase in minimum wage locally Loop Jamaica

The content originally appeared on: Jamaica News Loop News

This week’s featured development as Newsmaker of the Week just ended is the range of reactions to the announcement by Prime Minister Andrew Holness that Jamaica’s national minimum wage is to be increased by 44 per cent from $9,000 to $13,000 per 40-hour workweek, effective June 1.

The prime minister also announced that the minimum wage for industrial security guards will be increased from $10,500 per week to $14,000, also effective June 1.

The increases were just one of the myriad of “goodies” that were announced by Holness in his more than five-hour-long Budget presentation at Gordon House, which was plagued, in part, by audio and electrical issues, on Thursday.

Many observers have described the Budget presentation as Holness’ most comprehensive yet, with many projects to continue Jamaica’s economic growth and many social benefits for citizens.

Prime Minister Andrew Holness making his Budget presentation in Parliament on Thursday.

Specifically, observers and social media users have lauded the “welcomed” increase to the national minimum wage, but there are some who still hold the view that the increase is too small, given the continued rise in food prices and for other amenities locally.

Others are contending that the overall minimum wages could spell trouble for employers and businesses in terms of having to fork out more money to play employees.

As Holness announced the pending increase in the minimum wage on Thursday, Jamaica Labour Party (JLP) parliamentarians cheered loudly, and there was sustained desk-thumping among them.

There were even shouts of “Radam!” from some Government legislators, to express delight at the announcement.

The term was made popular by social media star Osbourne ‘Peanut Dread’ Ellis, and has been used by Holness in the past, and was employed in Parliament on Thursday to, among other things, bring across the message to criminals that the Government will be introducing a raft of measures to curtail their illicit activities.

Ellis was among guests in Parliament for Holness’ budget presentation.

Social media sensation, Osbourne ‘Peanut Dread’ Ellis, in a calm mood inside Parliament on Thursday during the Budget presentation of Prime Minister Andrew Holness, who invited Ellis to be a guest during the presentation.

Amid all the theatrics of the presentation, Holness said the differential between the national minimum wage and the minimum wage payable to security guards has narrowed because security guards are now classified as workers following a court ruling last year.

Holness said the next time an increase in the national minimum wage is announced, there will be no differential between the two groups.

According to the prime minister, the Government was strategic in its decision not to impose new taxes in the trillion-dollar Budget it has presented, in order not to erode the income of Jamaicans.

Said Holness: “We recognised that the contribution of minimum wage earners, such as household workers, artisans, labourers, store clerks and security personnel, is vital to the success of our manufacturers, hotel professionals, lawyers, doctors and teachers in meeting our national productivity and service targets.”

He also boasted that since assuming office in 2016, the Jamaica Labour Party (JLP) Government has increased the minimum wage from $6,200 per week to $13,000 or 110 per cent over the seven-year period.

He said the cumulative inflation over the period was less than 50 per cent, “and even in US dollars it represents a 66 per cent increase in the minimum wage”.

Holness further boasted that, “This Government – the Andrew Holness-led Government, your Government, our Government – has done more than any previous Government to create prosperity for Jamaica and Jamaicans, and we are proud to share the gains with all Jamaicans.”

In welcoming the increase in minimum wage, President of the Jamaica Confederation of Trade Unions (JCTU), Helene Davis-Whyte, said a liveable wage is ideal.

“We believe that based on what has been happening to workers in regards to the cost of living, basically ravaging their standard of living, we believe that an increase of this magnitude (in the minimum wage)…, should go a far way,” she told reporters.

Helene Davis-Whyte

“It still is not the ideal, but it should go a far way,” she added.

Davis-Whyte said work still needs to be done to move away from minimum wage to “liveable wage” in the future.

She is also hoping that the Minimum Wage Advisory Commission, on which the JCTU has a representative, will begin examining that transition in “short order”.

In reacting on behalf of security guards, President of the Jamaica Association for Private Security (JAPS), Teddylee Gray, said the group had lobbied for the minimum wage for the guards to be increased to $15,000.

“We have to thank the prime minister… We had asked for $15,000, and we got $14,000, which is roughly $3,500 increase…, but it is better than the $10,500 that we use to get for base pay,” he said.

“So, based on the officers’ reactions, a lot of officers seem happy with it, even though they wish, at least, they had gotten the $15,000 basic pay,” Gray added.

He also expressed the desire for the new rates to have been implemented in May, rather than June, “but it is better than nothing, and I am happy that the Government never waited until way in April to announce it.”

But Director of Operations for Guardsman Group Limited and President of the Jamaica Society for Industrial Security (JSIS), Lieutenant Commander George Overton, said while the increase in wages for security guards was expected, such a high increase, along with the preparations to turn security officers into full employees due to a court order, will result in a situation where “the fallout in the industry is going to be significant and severe”.

He told a local newspaper that security firms will have to brace for the challenges ahead relative to additional salaries, while, at the same time, maintaining their businesses.

Lieutenant Commander George Overton

And President of the powerful Private Sector Organisation of Jamaica (PSOJ), Metry Seaga, is also seeing challenges on the horizon for the business community in relation to the implementation of the new minimum wage rates.

“We have not had an opportunity to poll our membership at this point,” he said during a radio programme on Friday.

“There are some industries that are going to see it (increase in minimum wage) as an issue, and may have to reduce staff,” Seaga said, adding that “We hope and pray that is not the case.”

President of the Manchester Chamber of Commerce, Simone Spence-Johnson, said some companies will now be forced to make strategic adjustments to their businesses in order to accommodate the minimum wage increases.

“We’ll have to look at, ‘Okay, can we really handle, if we have say 10 workers and we’re increasing (the minimum wage rate by) $4,000 a week times 10’.

“The bottom-line, in terms of what is coming in, is, we’ll have to look at new marketing strategies, increasing our productivity rate, all of that, to ensure that we can keep up with what it is we’re doing,” she explained.

Metry Seaga

Spence-Johnson said as a business person herself, she has no problem with paying her staff “what it is that they need to get,” but it will be a struggle for others.

Many social media users also weighed into the discussions on the overall minimum wage increases for certain categories of workers locally.

“Employers need to remember this is a minimum recommendation. If they want better results, pay ppl (people) more than the minimum,” wrote Facebook user Johann Cover.

“Still too low. It should be the minimum of $20,000 per week,” remarked another user, Clifton Whittaker.

In response, Alecia Green wrote: “Clifton Whittaker, it would suit you to think before you talk. Picture this: I have a helper, I am working $170,000 per month and I would have to pay my helper $80,000 from that.”

For Yvonne Foster, the increased minimum wage might perhaps result in unemployment for some workers, instead of the intended salary increases.

“Yes that’s wonderful, but the downturn to it is some employers might not be able to pay that amount, so some folks might be jobless!” Foster argued.

“This is what you’d call, ‘Between a rock and a hard place’,” she added.

For another Facebook user, Humble Chick Tia, “All I know in this life you can’t plz (please) everyone.

“We same one was saying $9,000 was too small, right? Now it raise to $13,000 (and) ppl (people) start to complain about food is going to raise this and that.”

Commented Orlean Deers: “Good news, good news; at least it can stop a gap for those at the rung of the ladder. Yes, PM, you have done the right thing.”

Samantha Russell shared: “Some people are really unfair because is years now minimum wage earners need a good increase, so thank you Mr Holness.”