Efforts by the Ministry of Labour to reform the Labour Laws in the Labour Amendment Bill are laudable and are to be commended, but the Ministry must be careful that it does not cause more harm than good to the workers by forcing employers into burdensome situations.
While it is true that certain workers are exploited through low wages and inadequate benefits, and while it is also true that the government of Belize has a responsibility to protect the worker through fair labour laws, undue and unfair pressure on employers can have a devastating effect on employment if they cause jobs to dry up.
Belize is a country of high unemployment.
The only way to improve the situation is to create more jobs. But the private secror will not - cannot create more jobs if the cost of job creation is too high!
Take for example that area of the Labour Law which deals with termination of service. It says that a person who has worked with an employer for one or more years is legally entitled to one week of severance pay for every year of service.
If the person has worked for ten years or more, he is entitled to 2 weeks of severance pay for every year after the tenth year.
This has led some employers to limit employees - even good employees - to ten-year contracts because they find the 2-weeks of severance too onerous. Other employers have a policy of yearly contracts, renewable at the employer’s discretion.
If the government were to increase severance benefits any more than two-weeks, it would meet with serious resistance which would demonstrate itself in a flurry of short-term contracts. Employers would be forced to protect their long-term business interests, even if that means sacrificing good employees.
The Belize Chamber of Commerce and Industry has looked carefully at the proposed Labour Amendment Bill and has made some practical suggestions which make a lot of sense.
Employers in Belize today are under a lot of stress. The stress comes from the high cost of doing business in Belize. On this subject the recent IDB report Development Agenda for Belize, which provides a blueprint for development and job creation, has this to say:
“Using either measure (an index of production costs or an absolute level of production costs) its (Belize’s) cost structure is quite high when compared with those of major world exporters with which Belize must now compete.
Elsewhere on page 101 the report is more explicit. It says: “Product development and diversification require a favourable business and investment climate. Utilities such as electricity, telephone and water, although accessible, are expensive and add significantly to operating costs...”
If there be any lingering doubt about the health of the private sector, one only has to look at the number of business foreclosures to understand that employers are under stress - stress to the point of breaking.
Under these circumstances, Government would be well advised to tread softly.
Protect the worker by all means, but do not kill the goose that lays the golden egg.
Editorial, The Reporter