|Employment Act could lead to ‘abuse’|
Guardian Business Editor
Published: Aug 20, 2012
The managing director at Bahamas Waste says proposed amendments to the Employment Act will not only increase his labor costs by 20 percent, but also lead to further "abuse" of the work week.
Francisco De Cardenas was just one of many vocal business leaders that gathered at the British Colonial Hilton late last week for the latest Sunrise Rotary Club session. This particular meeting, featuring a presentation from Selvin Basden, senior manager of human resources at Bank of The Bahamas (BOB), dealt specifically with the much-publicized Employment Act.
Cardenas told Guardian Business he attended the session because he has a number of concerns.
The top grievance among most business leaders is the formalization of the one-hour lunch period as inclusive of the work week. While 40 hours is generally agreed upon as the standard number of hours for the week, including a lunch break would effectively reduce productivity by five hours and lead to higher labor costs.
"The problem is it gets abused, and the problem is if we increase the lunch hour to a paid one hour, it would probably get further abused," the managing director noted.
With an expected hit to payroll and productivity, the BISX-listed firm is taking a similar approach to Rupert Roberts, the owner of leading supermarket chain Super Value.
Cardenas told Guardian Business that the cost of including a one-hour lunch must be incorporated into the bottom line. And as such, those costs must be taken into consideration when considering payroll and performance incentives.
"If they get an hour more salary, then it becomes a decision on management's part on what to do. They have just gotten a 20 percent increase, so they might not get another increase in pay for a few years," he explained. "It will be good for them in the short term, but I can say on the long term it will be a challenge to justify giving them anything. We will obviously recognize performance and productivity, but this will have an impact."
The comment follows a similar a philosophy of Roberts, who noted in July that he will have to "treat it as a raise". The supermarket chief expressed less concern over the proposed changes to the Employment Act than others in the community, some of which have passionately condemned any changes.
Certainly, the general mood at the Rotary's last meeting was one of concern over the amendments. Also embedded into the new Employment Act would be a requirement for 24 hours of rest between shifts rather than 12. That change would present particular problems for some employers in the hospitality and service industry.
For BOB's part, Basden does not anticipate major changes to its operations and workforce, seeing as many workers are already on a standard five-day a week, 9 a.m. to 5 p.m. schedule.
The country at large, however, should brace for "countless hours of debate on both sides of the divide", he said. Just as employers seek to roll back some of the recommendations, unions and employees will no doubt seek even more changes to the act.
"I think one of the most obvious things here is employers are very concerned on the impact on overall business. But for the most part, at the end of the day, the exercise of people engaging and weighing in on the amendments is good for the country. It speaks to that kind of openness. What impact this all has on the law remains to be seen."
Basden told Guardian Business that BOB would participate in dialogue in how the amendments would impact the industry.
The institution, like many others in the business community, is very much in a "wait and see" mode as stakeholders consider what changes will actually come to fruition in the Employment Act.