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Sunday, May 1, 2011

Dominican Republic unions, employers in wage hike deadlock

The talks between labor and management for an increase in the minimum wage deadlocked Thursday, on different views on the cost of basic staples for a family of four and how inflation is measured.

The unions demand a 30% increase of the minimum wage and 25% for those who earn up to RD$50,000 per month, while employers offer 11.58% plus 1.5% for March inflation, or 13.8%.

In 2009 the minimum wage was increased to an average of RD$8,500, or 15% in the National Salaries Committee with the unions absent, which called that year’s decision illegal.

Dominican Republic’s minimum wage has the weakest purchasing power among Latin American and the Caribbean workers, comparable only with Bolivia, Guyana, Haiti, Mexico and Nicaragua, according to data of the World Wages Report 2010/2011 disclosed by the International Labor Convention (IEO).

The talks took a turn for the worse however, when dealing with the issue of the family staples, because the unions say it’s RD$29,000, while the employers’ is adjusted to Consumer Prices (IPC), or RD$10,407, and which was elaborated by the Central Bank.

For a minimum wage employee who works 26 days per month, and their lunch costs RD$100 per day, they would spend RD$2,600 monthly, and bus fare of RD$100 per day, or RD$2,600, their total is RD$5,200 monthly. They would have RD$3,256 left, without the discount for insurance, to spend on their family. This doesn’t include other expenses like education, recreation and culture, clothing and communication, as noted in the Central Bank’s lowest income group.

Source: Dominican Today

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