U.S. Senate Approves Minimum Wage Hike Delay For CNMI

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House of Representatives yet to consider bill

By Haidee V. Eugenio

SAIPAN, CNMI (Saipan Tribune, August 5, 2013) – Before adjourning for the August recess, the U.S. Senate passed Thursday night a bill that would once again delay a 50-cent increase in the CNMI’s minimum wage on Sept. 30 this year and in 2015. It remains to be seen, however, whether the U.S. House of Representatives would either pass the Senate version or amend its own omnibus territories bill.

The latter also extends the CW and E2-C investor visa program beyond Dec. 31, 2014, among other things.

"The clock is ticking," Gov. Eloy S. Inos told Saipan Tribune shortly before the U.S. Senate passed S. 256.

The bill now goes to the U.S. House for approval.

Inos is also concerned about a lack of a decision, to date, by the U.S. Department of Labor on the proposed extension of the CW program, which he said could also be addressed by HR 2200.

If the CW program is not extended, the CNMI will lose easy access to some 12,000 skilled and professional foreign workers that its tourism economy has relied upon for years.

There is less than two months to go before the CNMI’s minimum wage increases from the current $5.55 an hour to $6.05 an hour, unless Congress succeeds in amending a federal law.

A 2007 federal law mandated the CNMI to increase its minimum wage by 50 cents every year until it reaches the federal wage floor of $7.25 an hour in 2015.

Since then, the annual 50-cent hike had already been delayed once in 2011.

Delegate Gregorio Kilili C. Sablan (Ind-MP) said the 2013 and 2015 minimum wage increases will be skipped "to allow more time for business to adjust, the economy to improve, and the Government Accountability Office to report to Congress on the effects of the wage increases."

The next GAO report is due in April 2014.

While many CNMI employers want a temporary reprieve in the 50-cent minimum wage hike, affected employees are divided on the issue.

"There is no need to delay it again because they already delayed the increase in 2011. The cost of food, power, water, and other goods and services continue to increase. We can’t catch up anymore but increasing the minimum wage will help us a lot," a 54-year-old minimum wage earner said Saturday.

With four children to support, he said his $5.55 an hour salary isn’t just enough.

Tess Commandante, meanwhile, said she would welcome a 50-cent increase but not if it would cost her her job at a small retail company.

Commandate, a former garment factory sewer, said her employer won’t be able to sustain another 50-cent increase this year given that it has yet to recover from a slump. The 54-year-old worker said the company might be forced to shut down because of the added cost in workers’ wages.

"So I will choose not having an increase in salary this year than lose my job," she told Saipan Tribune.

Both the Saipan Chamber of Commerce and the Hotel Association of the Northern Mariana Islands have been pushing for a delay in this year’s minimum wage increase.

Florida-based human rights activist and former CNMI teacher Wendy Doromal said that while Sen. Ron Wyden (D-OR) and Delegate Gregorio Kilili C. Sablan (Ind-MP) introduced or supported S. 256, which calls for a delay in raising the CNMI federal minimum wage by 50 cents this year, both members also cosponsored legislation that would raise the federal minimum wage to $10.10.

"The inconsistently is perplexing, especially since Democrats support a fair federal minimum wage and support raising the federal minimum wage. In fact, President Obama called on the U.S. Congress to raise the federal minimum wage in his 2013 State of the Union Address," Doromal said.

She said the minimum wage hike delay "may not pass in the House [or even reach the floor of the House] before the scheduled September 2013 federal minimum wage increase is set to go into effect."

"That would be good news for the CNMI’s struggling, underpaid private sector workers who currently earn a deplorable federal minimum wage rate of $5.55 an hour," she added.

‘Breakthrough’

Wyden and Lisa Murkowski (R-AK) introduced S. 256 at Sablan’s request at the beginning of the year.

The bill conveys the CNMI the same 3-mile territorial sea or submerged lands limit as Guam and other U.S. islands.

Under current law, those lands are owned by the United States.

Sablan said the same legislation has passed the U.S. House three times, most recently on May 15 without dissent, "but has always stalled in the Senate."

"So this week’s action is a breakthrough," Sablan said.

Wyden and Murkowski reported the bill out of the U.S. Senate Energy and Natural Resources Committee, which they lead, with an additional provision rescheduling minimum wage increases in the CNMI.

The submerged lands issue arose when the Ninth Circuit Court ruled that the federal government owned all the nearshore waters around each of the Northern Mariana Islands. That was in February 2005.

Inos said he supports conveying 3-mile submerged lands to the CNMI which he said is better than none at all.

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