House calls in agencies on proposed wage hike

The House Committee on Ways and Means is holding next week its first public hearing on a bill proposing to increase the minimum wage in the CNMI.

Committee chair Rep. Norman S. Palacios said the hearing will be held at 6:30pm on Friday, July 22, in the chamber of the House of Representatives on Capitol Hill.

Palacios said officials and representatives of at least 27 agencies are expected to attend the meeting.

Among them are department secretaries led by Finance Secretary Fermin Atalig, Commerce Secretary Andrew Salas, Budget and Management director Ed Tenorio, Labor Secretary Joaquin Tenorio, and heads of autonomous agencies.

Also invited are representatives from various business groups: Saipan Chamber of Commerce, Hotel Association of the NMI, CNMI Banking Association, Rotary Club, and Society of Human Resource Management.

Palacios said all the municipal mayors and officials from the Governor’s Office, including the Attorney General’s Office will be given a chance to speak on the proposed measure, House Bill 14-30.

The resource individuals, he said, are requested to submit written testimonies to the committee on or before July 19.

House members voted earlier to refer the wage bill to the committee for more input.

Introduced by Rep. Heinz S. Hofschneider, H.B. 14-30 aims to increase the minimum wage from $3.05 per hour in the CNMI to $5 per hour, except those employed in the garment industry as sewers and cutters.

The bill also aims to relieve employers of certain statutory requirements.

For instance, the bill offers to remove the mandate on employers to assume liability and responsibility for all medical costs of nonresident workers.

It said that employers should rather offer health insurance benefits of which they would be responsible for paying at least 50 percent of the premium.

The bill also aims to restrict the Labor director’s discretion to impose other terms and conditions to a nonresident worker’s contract relating to meals, lodging, and work site transportation.

The House said that Palacios’ committee will hold a similar public hearing on Tinian and Rota.

The committee is also tasked to hold public hearings on the proposed 1 percent reduction in garment user fee as, contained in House Bill 14-325.

Authored by majority leader Oscar M. Babauta, the bill aims to reduce the existing 3.7 percent garment user fee to 2.7 percent to help the local apparel industry survive the impact of the worldwide lifting of trade quotas.

The bill said that the 1 percent reduction would serve as incentive so that the Commonwealth garment industry “can remain viable and contribute to the Commonwealth’s efforts for economic revitalization.”

It said that the reduced rate would complement the ongoing work at the national level for the amendment of Head Note 3 (a) of the U.S. Harmonized Tariff Schedule.

The amendment would allow local garment factories to increase the maximum allowable foreign content material from 50 percent to 70 percent.