Chamber not happy with the timing of new minimum wage announcement

The Antigua and Barbuda Chamber of Commerce has issued a press statement, voicing concerns and “utmost displeasure” with a notice from the Ministry of Labour informing residents that it has ordered a  Minimum Basic Wage of $9.00 per hour for employment effective 1st January 2023.

Yves R. Ephraim, the President of the Antigua and Barbuda Chamber of Commerce said the timing and manner with which the “Minister responsible” has issued such notice for several reasons.

“The Minister responsible has created unnecessary angst for many affected businesses by issuing the notice on the day before payday (26th January 2023) and for simultaneously making the implementation of the Minimum Wage retroactive by setting the effective date as of 1 January 2023”, he said.

Further, Ephraim added that the notice comes when most of the affected businesses would have already completed payroll and have already sent paychecks to their employees’ bank accounts.

He said Steadroy Benjamin, the Minister responsible, in the Chambers’ opinion acted without regard for how such retroactive implementation on the eve of a payday would have stoked unnecessary tension between employer and employees, by giving the false impression that the affected employers might be deliberately failing to comply with the law.

“As was previously mentioned, some affected employers had already processed their payrolls before the Minister’s order was made public.

 The Minister responsible exercised a lack of compassion by ignoring the fact that those affected businesses already feeling the negative effects of an underperforming economy were already dealing with the increase of Social Security contributions, starting this January,” the Chamber added.

“One would have thought that the public notice on the 26th of January, 2023 would have announced the introduction of the new Minimum Wage from the 1st of February, 2023. This is what we would expect a caring government to do”

Furthermore, the Chamber said the Minister responsible should be aware that the effect of this increase in the Minimum Wage, represents a 9.75% increase in payroll cost for certain affected and struggling businesses whose payroll costs are already as high as 80% of income before this increase.

And additionally, the effect of compounding this increase with the Social Security increase and the other payroll taxes has translated this nine-dollar ($9.00) Minimum Wage into an actual $10.26 per hour payment for affected employers.

‘It is unfortunate that some of these affected businesses will immediately suffer major losses without the opportunity to announce a possible increase in prices for their goods and services or a possible laying off of some staff.

“Regrettably, this matter could not have been implemented with some degree of care and we hope that this shock would not negatively affect jobs in the affected industries, some examples of which are security firms and gas stations”

The Chamber said it hopes that the Minister responsible would “consider the points made and use them to inform the manner and timing of future orders to increase the Minimum Wage”