80-hour work schedule reinstated

Gov. Arnold I. Palacios and Lt. Gov. David M. Apatang have officially issued a directive restoring the reduced work hours of executive branch employees to 80 hours per pay period.

Yesterday Palacios and Apatang invited members of the media and members of the Legislature to the Office of the Governor for a press conference to announce the good news.

Since April 2023, work hours had been reduced to 70 per pay period as part of a comprehensive cost containment strategy to manage revenue shortfall without compromising essential services.

Over a year later, Palacios said the CNMI administration is finally able to revert 700 employees’ hours back to 80 starting Nov. 3.

The directive stated that beginning on Nov. 3, 2024 (Pay Period #25), austerity work hour reduction will be lifted and hours restored to 80 hours for all employees affected. Department and agency heads may inform their employees that reduced hours will end on Saturday, Nov. 2, 2024.

The directive also provided that Sections 6 through Sections 10 of Directive 2025-001 will remain in effect until lifted.

“The cost containment measures, though difficult, needed to be implemented as our Commonwealth’s economy faced numerous challenges. Lieutenant governor and I understand the impact that austerity measures have placed on our employees and their families, and we have been working diligently to advance initiatives that would reduce expenses, increase revenue collections, and provide much-needed restoration of hours that promote our employees’ financial stability and wellbeing,” he said.

“Recent developments have assured us that we can move forward with restoring employee work hours, and the budgetary impact of doing so can be addressed under the current provisions of the FY 2025 Budget Act, which allows for 100% reprogramming authority,” Palacios adds.

When asked where the funds to reinstate full-time hours came from, Palacios said it’s a combination of different sources.

“The funding will be a combination of ARPA, federal grants, and some adjustments and cost containments of other items in the budget. We couldn’t do this with existing funding last fiscal year because it was very tenuous, so we had to wait. We were working on this and considering it and looking at the issues that we need to address and the requirements we needed to pay out first before we roll this out. Once the 2025 budget was approved by the Legislature, we took a look at it and see where we could do this. It was a drawn-out exercise. Throughout the last six months, we’ve been looking at how to stabilize and finance the government,” he said.

Palacios also clarified that while this announcement comes just a few days before elections, it is merely a coincidence as this reinstatement has been in the works for six months.

“We have been weighing many factors before considering if we could fund the additional 10 hours. I never really thought about election. We’ve been working very hard to get our employees and their families back to 80 hours. Whether election is in five days or in a year, we’ve been working [on this] for the past six months. We’re not out of the woods. But the lieutenant governor and I, with the understanding of the Legislature, would continue to release a revised budget in the near future so that we can sustain this over this whole fiscal year and into the next fiscal year,’ he said.

Finance Secretary Tracy Norita added that Finance was able to redirect funds through the execution of agreements regarding debt service obligations.

“It has been a tough year, 18 months of cost containment measures. These were painful cuts that has to be made in order to stabilize government revenues and control expenditures. and this administration has been working together for months to find solutions to alleviate the hardship that has been placed on these employees who have been affected by austerity. [Now] we are in the final stages of executing some agreements that will directly impact our debt service obligations and because of this, we are allowed to redirect funds to restore hours for these employees. We anticipate to finalize and execute these funding instruments and hopefully the timeline is by the end of next week,” he said.

Apatang, for his part, shared that he is just happy to announce the good news.

“This is good news to all our employees to the government. We have been anxiously waiting for this. I’m very happy, we’ve been working very hard to get our finances together. We were struggling in the beginning; our people here were working together and that’s how we succeeded to make this possible today,” he said.

In closing, Palacios reminds all employees that they—including himself—are all public servants entrusted to deliver the needs of the community as a whole and as such, must continue to work diligently to improve services to the public and contribute in the overall effort to control expenditures.

Palacios instructed all department and activity heads to review their fund balances for the remainder of the fiscal year to confirm the availability of funds and identify any potential shortfall to cover the cost of the increase in work hours of current active employees.

This information should be made available to OMB no later than Nov. 1, 2024.

Given that the Appropriations Act (P.L. 23-26) did not provide the funds to pay for the restored hours, Palacios stated that he and Apatang will be working closely with the Office of Management & Budget and the Department of Finance to prepare a proposed amendment to Public Law 23-26 that will be submitted to the Legislature.