NA proposes prison time and fines for employers who violate legislation

POSTED: 06/10/11 1:35 PM

Initiative law short term labor contracts

St. Maarten / By Hilbert Haar – The national ordinance short term labor contracts, an initiative law drafted by the National Alliance faction, punishes employers who violate it with a maximum of 8 months imprisonment or a 10,000 guilders ($5,555) fine. Faction leader William Marlin presented the initiative in a press conference on May 20. He did not immediately release copies of the draft law, but in the meantime this newspaper has received an amended copy dated June 2.

The National Alliance wants to prohibit temporary contracts for jobs that are not of a temporary nature, unless the Minister of Labor Affairs gives permission for it in writing.

To curb the abuse of 6-month labor contracts, the National Alliance wants to make such contracts permanent after they have been extended more than three times with an interval of more than three months.

The draft law stipulates that specific rules concerning its execution as well as the conditions companies must meet to qualify for a permit to hire an employee on a temporary contract will be regulated by national decree.

Labor contracts that violate the first article of the ordinance (by offering a short term contract for what is in fact a permanent job) are null and void.

The National Alliance writes in the explanatory memorandum that the initiative legislation is designed to close a loophole in the national ordinance flexible labor legislation that was introduced eleven years ago in 2000.

That ordinance stipulates that successive temporary labor contracts offered with intervals of less than three months and that exceed together with those intervals a period of 36 months are considered permanent labor contracts.

To get around that law, the National Alliance says, employers started to offer temporary contracts with intervals that are longer than three months. “That way, an employee will never qualify for a permanent contract. The employer makes improper use of the legislation by circumventing the protection against dismissal.”

The NA writes in the explanatory memorandum that some employees have been working for ten years or even longer for the same employer, doing the same job, but all the time on short term contracts. Other employers send employees home for six months before they offer them a new short term contract.

The National Alliance says that “a significant part of our employees that work in certain sectors of the economy are the victim of these unacceptable practices.” The party says that employees who find themselves in this situation have less security than employees with permanent contracts.

“He will have trouble getting a mortgage for building a house. If a man and a woman belonging to the same household are working for years on short term contracts, they have no economic security because they could become unemployed anytime. This has consequences for the social benefits the government has to make available. Such a situation is inadmissible from a social and a human point of view.”

The National Alliance states in the explanatory memorandum that the abuse of the short term contracts amounts to abuse of law and improper use of legislation if there are no reasons not to hire the employee on a permanent contract.

The party concludes that implementing its initiative law will benefit the development of the labor market and the economy and that it will also improve social peace.

One of the more revolutionary ideas the National Alliance has put forth is to consider – after the new legislation takes effect – existing short term labor contracts as permanent if they have been extended more than three times with intervals of more than three months,

The draft law, the explanatory memorandum and the elucidation per article all remain vague about the category of businesses that will still be allowed to offer short term contracts. The conditions these companies would have to meet are not specified either.

Mr. Wim van Sambeek, an attorney with HBN Law specialized in labor legislation who has read the draft, said in a comment to this newspaper that it should have been based on a labor market analysis.

“The explanatory memorandum states that subsequent short term labor contracts with intervals of more than three months are being abused. The introduction states, without substantiating this, that this is the case and that the problem is urgent. My experience is that this abuse does not occur frequently and that there is a link with the high and the low tourism season. However, I think that it is necessary to do some research to analyze the problem.”

Van Sambeek refers to a Dutch survey about abuse of short term labor contracts that concludes that just ten percent of the surveyed employers attempted to prevent permanent contracts by using the 3-month interval term. “I have no idea how the abuse that has been established in the Netherlands compares to the situation in St. Maarten. Thorough research could make this clear.”

The attorney also refers to the new civil code which is awaiting implementation. The code contains an article that prohibits employers to make a distinction in labor conditions between temporary and permanent employees.

Van Sambeek’s main concern touches on the solution the National Alliance has chosen to solve the situation. “If it is true that employers abuse the short term labor contracts, I do not think that legislation is the appropriate way to solve this. Legislation hardly ever solves anything.”

It was better, the attorney told this newspaper, to have the social partners make agreements in collective labor agreements. “My opinion is that there ought to be umbrella collective labor agreements for sectors like the hotels and the casinos but I do not know whether the social partners want this.”

Van Sambeek also points out that article 39 of the Kingdom Charter demands that the civil code in the Kingdom remains as much as possible identical in all parts of the Kingdom. “Proposals for far reaching changes in existing legislation are not submitted before the governments in the other countries in the Kingdom have had the opportunity to express their opinion.”

Introducing categories of labor contracts with different levels of protection, as the draft law proposes, is “new in the Kingdom and a far reaching deviation of the current trend.” Van Sambeek fears that the proposed legislation will stifle the labor market and that employers will increasingly tend to hire staff via manpower companies.

“The ordinance that regulates hiring temp workers though manpower companies has never been implemented in St. Maarten. This ordinance sets standards and limitations for hiring temp workers and it could help to curb the side effects.”

Van Sambeek also notes that a large number of articles in the draft do not belong in the civil code. One of the legal shortcomings he notes is that it is not possible to distinguish categories of labor contracts. “Something like a permanent function does not exist,” he told this newspaper. “Functions and organizations are not inflexible; they change constantly. Furthermore, organizations are not always recession-proof.”

In conclusion, van Sambeek said that a joint effort by the social partners to analyze labor market problems and to engage in debate about solutions is preferable to the proposed legislation. “My preference is also based on the fact that I am not convinced of the problem solving ability of governments and that I have more confidence in the market.


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