‘Wage bill may lead to takeover try’

Any attempt to increase the CNMI minimum wage level—may it be local or federal—would spell economic disaster to the already eroding economy of the Northern Marianas. In fact, to tamper with the existing minimum wage law is an attempt to tinker with the U.S.-CNMI Covenant and could open the floodgates for another attempt by the federal government to take over control of immigration in the Commonwealth.

House Speaker Benigno R. Fitial stressed this yesterday, saying that S. 2370 as introduced by U.S. Sen. Edward Kennedy and H.R. 4256 as introduced by U.S. Rep. George Miller would have a damaging impact on the CNMI economy, just when the apparel industry is on the verge of collapse.

Both measures seek to amend the Fair Labor Standards Act of 1938 to provide for an increase in the federal minimum wage. It also contains a section that would apply the increase to the CNMI’s minimum wage structure.

Other sponsors of the bill are Sen. Daniel Akaka of Hawaii, Sen. Hillary Clinton of New York, and Sen. John Kerry of Massachusetts, who is running for president, among others.

“Any move to increase the minimum wage…would spell economic disaster for the CNMI, specifically the garment industry. It [apparel industry] would not be able to compete globally anymore because the cost of doing business in the CNMI is becoming more expensive than other places where garment is manufactured and exported to the United States,” said Fitial.

Under the Covenant, the U.S. has sovereign control over the Commonwealth’s foreign affairs and defense but the CNMI maintains its authority over its labor and immigration laws and has the right to local self-governance.

Fitial said any possible attempt to increase the minimum wage is already an attempt to amend the Covenant. He also urged the U.S. Congress to respect the sanctity of the agreement.

“The Covenant is clear. It gives the CNMI the right to control its labor, immigration, and minimum wage. Any member of the U.S. Congress who wants to increase the cost of doing business in the CNMI by increasing the minimum wage is not a friend. They should respect the Covenant because the CNMI has been respecting it. There was never in the history of the CNMI that it ever attempted to control its own foreign affairs and defense. We are asking our brothers in the Congress to respect it,” said the House speaker.

Fitial believes, though, that the CNMI has many friends in the U.S. Congress in whom the Commonwealth can depend and rely on for support.

“We are grateful to the U.S. Congress and the U.S. Administration for their profound respect to the Covenant except for some few members,” he added.

On April 29, Sen. Kennedy and U.S. Rep. Miller introduced similar bills at both Houses that aim to amend the Fair Labor Standards Act of 1938 to provide for an increase in federal minimum wage.

Billed as the Fair Minimum Wage Act of 2004, the measure hopes to increase the CNMI’s minimum wage from the current $3.05 an hour to $3.55 an hour, to be increased by 50 cents an hour beginning six months and every six months until the minimum wage applicable to the CNMI is equal to the minimum wage in the U.S. mainland.

Under the proposed bill, the minimum wage level is $5.85 an hour, to be increased to $6.45 an hour after 12 months and $7 an hour after two years.