Fair wage act hurting local employees • Sen. Pete Reyes raises possiblity that company may use law to terminate workers

Amid mounting calls for public hearing on the Resident Workers Fair Compensation Act, a legislator urged administration officials to immediately resolve problems stalling its implementation in light of reports that some companies have used the law to terminate local employees.

Senate Floor Leader Pete P. Reyes alleged LSG Lufthansa Sky Chefs has started cutting back its local workforce ahead of the implementation of the controversial law — a charge denied by a company official.

The senator said the termination shows “serious insensitivity to the equal treatment of employees,” adding the government should bar LSG from hiring foreign workers if it continues to discriminate against resident workers.

“It hurts that they are biased and the law should not be used as a war game between employee and employer,” Reyes said in an interview.

But LSG Resident Manager Renee Willem maintained they are awaiting release of the implementing guidelines on the law drawn up by the government to begin compliance.

“I have no other comment except to say that is not true,” he told in a telephone interview. “We are gearing up at this stage and we will work within the law.”

According to Willem, the company employs half of its manpower needs from available local labor pool — locally-born US citizens and Micronesians — while the rest are recruited from other countries, mostly from the Philippines.

Signed last March, the law mandates employers to extend benefits provided to nonresident workers, like medical care, insurance, transportation as well as subsidized housing and food, to locals still earning less than the prevailing federal minimum wage of $5.15 an hour either in cash or in kind.

But the business sector led by the Saipan Chamber of Commerce, worried over potential lawsuits resulting from vague provisions in the law, has called on the government to hold a public hearing for possible changes to the policy.

Reyes expressed optimism that differences on its implementation would be resolved soon, saying the Legislature will come in once the amendment is deemed necessary to further clarify some provisions.

“It should be implemented as soon as possible because our local workers have been waiting for it,” he said. “Unfair salary treatment for local workers is a matter of concern for us.”

Drafted by the Attorney General’s Office and the Department of Labor and Immigration, the guidelines were initially intended to clear ambiguities but business leaders underscore the need for amendment to remedy potential problems in the future.

The hearing would also help in solving the inequities that may affect the resident workers, employers and even guest workers once the law is hastily implemented, according to the Chamber.

The AGO has given the private sector until May 15, 1999 to comment on the proposed rules and regulations of Public Law 11-74 before these are adopted.