Adriano favors passage of special bill for garment

Concerned over the impact of increased unemployment among garment workers, Senate President Joaquin G. Adriano favors the passage of a bill that specifically addresses the proper repatriation of displaced garment workers.

“I will support that. A specific bill is needed for that. We can see all around that the numbers [of displaced workers] continue to grow. We need to address that and get them back home,” said Adriano yesterday.

He said that keeping unemployed workers in the CNMI would be “too much” for the government and the local economy.”

But he said that instead of getting rid of the 45-day grace period altogether, as proposed in the House of Representatives, the period can be reduced to 15 days.

“If you disallow consensual transfer, you have to have the 45 days reduced to 15 days in order for them to get out properly,” said Adriano.

Further, the Senate president said he agrees with the move to raise the labor bonding requirement to ensure that funds are available for repatriation and settlement of unpaid salaries and wages.

“I understand some of the bonding insurance companies are not there and don’t have enough money. I agree that we’ve got to raise the bonding cap,” he said.

The Department of Commerce earlier said that the existing insurance law, which was enacted in 1983, only requires a $25,000 capital to open an insurance company. Each additional line of insurance offered requires $15,000. If the company has $100,000, it can offer all lines of non-life insurance products.

Insurance administrator Jesse Palacios said the Insurance Commission aims to push for amendments to the law to raise the $15,000 requirement to $100,000 per class or line of insurance.

Meantime, effective Feb. 28 this year, the commission began to implement a regulation that requires all insurance companies to provide additional reserve—10 percent of their premium—in a bank account “to better suit the risk of exposure of claims based upon the labor bonds.” After a year, the rate will increase by 5 percent until the total retained rate reaches 25 percent.

Under the rules, bonding companies are required to shoulder any unpaid salary or repatriation costs for nonresident workers, if their employers fail in their obligations.

The garment industry alone, which is downsizing as a result of the worldwide lifting of trade quotas, consists of over 15,000 workers.

At least three factories have closed down, leaving some 1,000 employees without work.