Guam Governor, Speaker Face-Off Over Possible Increase Of Minimum Wage

Overdue economic impact report of previous wage hike due soon

By Shawn Raymundo

HAGÅTÑA, Guam (Pacific Daily News, Jan. 26, 2017) – Gov. Eddie Calvo and Speaker Benjamin Cruz traded barbs this week on the issue of increasing the island's minimum wage.

Calvo last week successfully vetoed a bill by Cruz that would have increased the wage to $10.10 by early next year. The governor instead introduced a separate bill, calling for a smaller increase, but only after a report is completed about the impact of wage increases.

The wage study, which examines the economic impact of the last minimum wage hike, in 2015, was supposed to be completed in April 2016, but is scheduled to be released Friday. The study is being prepared by Market Research and Development Department of Labor Director Sam Mabini reported last month.

Lawmakers, after increasing the minimum wage from $7.25 to $8.25 in 2015, required the Labor Department and the Guam Economic Development Authority to assess the economic impact.

Cruz last week blasted Calvo for vetoing Bill 312-33 a week before the wage report was supposed come out. According to Cruz, the governor had until next Monday to act on the measure before it died as a pocket veto.

“Today, Gov. Calvo has shown that the only pay raise he cares about is the one he and his cabinet got in 2014,” Cruz said in a written release.

While speaking at the Guam Chamber of Commerce’s first general meeting of the new year Wednesday, Calvo fired back at Cruz for moving forward with the wage bill during the December session, despite pleas from Adelup and local stakeholders not to consider the bill until the wage report was complete.

“Why did you pass this bill in the first place? Because you couldn’t wait for the report to come out. Isn’t that something like the pot calling the kettle black?” Calvo said during the meeting, which Cruz attended. “We all want raises and wage increases, but no person in their right mind wants to do this if it means they have to let go of staff, or cut hours and benefits.”

Following the Chamber meeting, Cruz reiterated his previous statement.

“The report was coming out this weekend, and (Calvo) could’ve waited and viewed it and used it as the basis for his veto if in fact it should’ve been a veto,” Cruz said.

Governor's Special Policy Advisor Troy Torres, said the governor could have waited until this weekend to veto Cruz's wage bill, but said the wage report could take longer than a few days to review.

"I think the original question is why couldn’t the Legislature wait to pass this (bill) after they saw the report? What was the big rush to get it passed before the report came?” Torres said. “The responsible thing to do was to wait for the information to come, and it may take more than two days to analyze what was in that report.”

Calvo's alternative wage bill calls for a one-time 95-cent increase in the minimum wage, to $9.20. The raise would kick in at least six months after the release of the report and only if certain qualification are met.

Before the workers can get their raises, the labor director must ensure that the majority of Guam’s employers won’t reduce their staff’s hours, cut their benefits and trim their workforce, the governor's bill states.

Cruz has since stated that Calvo’s proposed bill dangles false hope to Guam’s minimum wage workers.

“If Gov. Calvo opposes increasing the minimum wage, he should just admit it, because giving thousands of working class families false hope with this fake proposal is a sin,” Cruz said in a press release.

Although the wage study has not been released, Cruz said a pair of reports by the Labor Department and the Department of Public Health and Social Services show that unemployment had decreased after the minimum wage hike.

“Their own report shows there’s been a decrease, so people obviously didn’t quit and other people were no longer qualified (for welfare) because their salaries were no longer below the poverty line.” Cruz said last year.

Several stakeholders, backed by the Chamber of Commerce, have warned that a wage increase could force businesses to trim the number of people they employ and increase the price of goods and services on island, which would hurt those on fixed incomes.

“My main objection to Bill 312-33 is its premature passage. We cannot and should not play guessing games with policy that can end up hurting the very people we purport to help,” Calvo said in his veto message.

Pacific Daily News
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