Bad economy bares weak spots in labor enforcement

At no other time is the need for more Labor investigators needed than now. With the ongoing downsizing of the garment industry and the demise of several businesses on the island, the CNMI is flush with nonresident workers who are fresh out of jobs and desperate enough to clutch at straws in their effort to remain on the islands.

A check on the number of nonresident workers who had been let go or had lost their jobs and those who had been repatriated would show a discrepancy, with more workers seemingly staying on rather than going home. A check with Labor records would also show several businesses this year exhibiting a higher than normal turnover rate among its employees, with workers being let go, to be replaced by these newly-unemployed workers. This is so because the new workers are willing to accept lower wages, sometimes even lower than the minimum wage rate of $3.05. These workers are accepting employment for a flat monthly rate of $300 to $400, without any overtime pay. In most cases, these companies’ records would show adherence to the $3.05 rate but what is not shown are the unpaid overtimes, considering that most of these workers put in 10 to 12 hours everyday.

Of course these workers are not going to file a Labor complaint. I have talked with several of them and they have become resigned to their situation. Faced with the uncertain prospect of finding other jobs or the idea of going home, these workers take on these jobs, agreeing to work 10 to 12 hours everyday for a flat fee, and signing any blank document that is presented them just so they can keep their jobs.

Unfortunately, this situation comes as no surprise, with the bleak economy removing any scruple an employer may have about breaking the law. It is almost understandable, as people’s propensity to consume decline and expenses for entertainment and pleasure gets redirected to cost-of-living expenses. With lesser money flowing within the economy, businesses are forced to take drastic, and sometimes illegal, steps just to keep their heads above water. What makes it worse, though, is that some of these firms (mostly small and foreign-owned) have been doing this for quite some time now, way even before the economy started heading south. Cooking the books, so to speak, so that everything appears legal and above-board. The lack of Labor investigators exacerbates the problem, allowing these companies to get away with these transgressions.

What we need is a strong compliance division within the Labor Department, one with the necessary wherewithal and enough manpower to conduct extensive investigations and the teeth to go after violators. The Legislature and the Executive Branch must stop paying lip service and actually look out for this department, giving it enough of a budget so it could do its job effectively. Considering that the CNMI relies so much on alien labor and have had so much grief in the past over its treatment of nonresident workers, it should have a Labor Department that is as high on the totem pole of priorities as education and tourism.

Of course, law enforcers can only do so much. We probably also need a whistleblower protection law, to ensure that employees who report on their employers do not become subject to retaliation. Also, peer review and peer pressure have their roles in ensuring compliance with labor rules. Businesses themselves must help police their ranks, for a more effective compliance with the law. The garment industry already has the Saipan Garment Manufacturers Association and the Garment Oversight Board, which have helped ensure that members keep to the straight and narrow. The hotels have their Hotel Association of the Northern Mariana Islands. Other businesses that need self-policing are the poker arcades, the taxicabs, the small restaurants, the massage parlors, among others. There are so many of them on the islands that we might as well call them industries, too.

This is not just a matter of ensuring that everyone follows the law. By banding together and helping one another, these businesses will also acquire a voice, which could help them lobby for changes in the regulations or more leeway in the way they conduct their business. As it is right now, each one is left to fend for themselves, so when something comes up that would impact them, they have very limited ways of conveying their sentiments to the proper channels. As a united group, lawmakers and government officials would be more inclined to listen to them and address any complaints they may have.

In the final analysis, effective compliance with labor and wage laws would require the cooperation of everyone—the government, law enforcers, the employers, and the businesses themselves. We have to, if we are to avoid having the U.S. Department of Labor do it for us.