PHILIPSBURG:--- The St. Maarten Hospitality & Trade Association (SHTA), the largest business representative on the island, has taken note of political grand standing of most parties about eliminating the short term contracts and raising minimum wage.
First and foremost SHTA in no way, shape or form condones the abuse of revolving short-term contracts, but even in its current form, where rules on exactly when an employee becomes permanent are clear; the actual enforcement of these existing laws is the problem. The misuse stemming in and of itself from an imbalance in the labor market, that may be based on too much protection (perceived or not) which cannot correct itself due to the imposed rigidity. For the labor market to function optimally there must be balance between protection of the employee and viability of the system.
This balance – as history has shown – cannot be achieved by tweaking and re-tweaking the existing laws and policies if the basis remains rigid rather than working toward a more flexible labor market. Over the years all restrictions and additional layers of compliance have lead to an even greater imbalance in the labor market, as evidenced by, for instance the eruption of employment agencies and the growth of the informal economy such as the "gypsy" taxi drivers, who operate without licenses, and without paying taxes and social premiums, thereby providing a low cost service as dictated by demand.
Time and again, the advice by our own higher councils of state, our own Central Bank (as recently as Tuesday August 19, 2014) and international experts such as the IMF is the same; our labor market is termed as "very rigid", if sustainably decreasing unemployment is in fact the ultimate goal, than flexibilising the labor laws is the only way forward.
In an effort to work towards more flexible labor arrangements, as is the case worldwide, during the past years, the SHTA representatives, in a tripartite setting, have been discussing and recommending a major overhaul of our labor system, following a holistic approach rather than a piece meal one. Unfortunately, these discussions have not been successful.
SHTA still champions renewed negotiations including employers', employees' representatives and government with the ultimate goal of an improved, flexible and sustainable labor market regulation that takes adequate protection and viability of the whole system into account. In the meantime the regulations on specifically the areas recurring as political fodder (i.e. the short-term contract) need to be enforced. The safeguards have been in the law for a long time, without enforcement, adding additional layers of compliance will not solve anything and will quite probably reduce job opportunities.
The SHTA is dedicated to bringing quality to all aspects of life on St. Maarten by promoting sustainable economic development for its members in cooperation with the social partners and the creation of a fair marketplace. For more information please contact our offices at 542-0108 or visit our website at www.shta.com.