By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A trade union leader yesterday suggested the Bahamian private sector will eventually “come round to reality”, with its response to proposed labour law reforms showing it does not react well to change.

Obie Ferguson, the Trades Union Congress (TUC) president, told Tribune Business he had been “surprised” at the vehement reaction of employers to the controversial reform proposals unveiled by the Government last week.

He challenged them to say that Sandals had behaved properly in terminating its 600-strong Royal Bahamian staff to facilitate $4 million worth of repairs, adding that this was not the procedure followed “in most civil societies”.

Mr Ferguson and other trade union leaders were last night still in a meeting with Prime Minister Perry Christie and senior government officials over the Sandals matter, amid labour movement warnings that it is “planning something major” if the Government fails to satisfy its concerns.

While the meeting went beyond Tribune Business’s press deadline last night, Mr Ferguson told this newspaper that he could not understand why employers were objecting so vigorously to the two reforms proposed by the Government.

“I’m having some difficulty understanding the reaction,” Mr Ferguson said. “Change is not something easily acceptable, but the employers will come round to realise that you can’t have someone who works for you for 30 years and, when you make them redundant, you only have to pay them the same as someone who has worked for you for 12 years. I have a problem with that. That can’t be right.”

This refers to the Government’s proposal to remove the Employment Act’s ‘12-year cap’ on severance/redundancy pay, a move that Mr Ferguson has long agitated for.

The idea has been on the table for some time, but the Government appears to be using the Sandals terminations to bring it to the forefront yet again, in a bid to seemingly appease both the trade unions and the wider Bahamian public.

The Employment Act currently allows line staff two weeks’ severance pay for every year worked up to 12 years, ‘capping’ the maximum payment they are entitled to at the equivalent of six months’ salary plus two weeks’ pay with, or in lieu, of notice.

Managerial staff are entitled to one month’s severance pay for every year worked, ‘capping’ the maximum sum they are entitled to at the equivalent of 12 months or one year’s salary, plus a month’s pay with, or in lieu, of notice.

Mr Ferguson acknowledged that the amount of severance pay employees should receive, and what the Employment Act ‘cap’ should be raised to, were issues to be debated between the private sector, trade unions and the Government through the Tripartite Council.

“The amount of severance pay, that’s debatable,” the TUC president said. “I can understand that being an issue to be discussed, but I certainly didn’t expect the employers to object.”

He argued, though, that the current ‘12-year’ limit was “inequitable” for long-tenured workers who were made redundant after giving 20-40 years’ service.

However, such employees have been able to win greater benefits and compensation above the Employment Act’s cap by initiating common law actions in the Supreme Court.

The Bahamian judicial system has previously ruled that the Employment Act was intended by Parliament to provide only a statutory minimum, or floor, for severance payments made to Bahamian workers.

Employers fear that removing the Employment Act’s 12-year ‘cap’ will make redundancy cost prohibitive, especially in cases where they may need to downsize to survive. And there may be unintended consequences, such as discrimination against older workers and a move to casual employment, if the Government forges ahead.

Still, Mr Ferguson said: “I’m surprised that the employers would react in this manner because I would have thought that looking at the Sandals matter would cause them to want to meet and make an agreement that’s satisfactory to all parties.

“The way that was done [Sandals terminations], in most civil societies it would not be done in that fashion. You don’t just wake up and do that. That’s not good industrial relations.

“I can’t see the employers agreeing that what was done in the Sandals matter was done properly. It is not reasonable for the employer to make the case that was proper. The manner in which those 600 workers were terminated, I don’t think the Bahamian public thought that was the proper way to do it, certainly not in the manner it was done.”

The other key reform being pushed by the Christie administration is to make it mandatory for employers to provide two months’ (60 days) notice to itself and the relevant bargaining agent (trade union) whenever they are about to make 10 or more workers redundant, with failing to do so becoming a criminal offence.

Mr Ferguson suggested this was merely putting into statute law what is already contained in most industrial agreements, where employers have to abide by a certain process, consult the relevant trade union and provide a specific notice period to employees being made redundant.

“Notice is almost mandatory in any event. Every industrial agreement that is registered provides for notice in case of redundancy,” he explained. “It’s now being made statutory.

“I don’t see why it’s an issue now, really and truly. If the agreement is registered, it has the effect of legislation.”