Demapan to resume talks with businesses on wage hike

Rep. Angel A. Demapan (R-Saipan) said he would continue to engage the business sector in consultations and talks to discuss the legislation he introduced at the House of Representatives. The Precinct 1 representative authored House Bill 19-187 that aims to raise the CNMI minimum wage directly to the federal level of $7.25 an hour.

The CNMI minimum wage increased from $6.05 to $6.55 last September and is expected to rise again by another $0.50 next year until it reaches the federal level of $7.25 in 2019. Demapan said he introduced HB 19-187 based on his talks with various sectors of the community.

“The $7.25 legislation was a result of consultations with the Saipan Chamber of Commerce and the administration, and based on data supporting that this was the right time to increase the minimum wage,” Demapan, the House Committee on Commerce and Tourism vice chair, told Saipan Tribune.

He said they would also continue to look into the concerns of the small business owners. “We are going to continue to engage the business community, continue with the dialogues and engage them in consultations. We understand some small businesses have come forward and raised their concerns. And we are going to look at those concerns very carefully.”

Before the minimum wage increased to $6.55 an hour last September, Chamber president Velma Palacios said mom and pop stores were among the businesses that could not afford the $0.50-cent increase. Their operations would be affected if they would immediately increase the hourly rate of their employees, Palacios said.

Demapan said the final decision for his minimum wage bill would be based on what is best for the people of the CNMI. “But ultimately the final decision will be based on everybody’s concerns. The best decision and policy is to ensure that the people in the community would benefit from it.”

The increase in the minimum wage to $6.55 an hour also forced business owners to raise the prices of basic commodities and other goods. Demapan said that is normal since employees could still afford it with their current salary.

“Yes, we are seeing increases in the prices of goods at the stores, but the employees earning the minimum wage also have that increase to [offset] whatever increase there is in the prices of basic goods and commodities,” added Demapan.

The House Ways and Means Committee had been reviewing the amendments made by the Senate on HB 19-187. The House passed the measure and it went to the Senate where they made some amendments. Once the bill, with amendments, passes, it will head to Gov. Ralph DLG Torres for signing.

Salary range

One way that the CNMI government and the business sector could look at is having a salary range for each job category, a practice now being followed by three U.S. territories—American Samoa, Puerto Rico, and the U.S. Virgin Islands. Guam’s minimum wage is $8.25, $1 higher than the federal rate.

American Samoa’s minimum wage rate is divided for its 16 industries, from $4.58 to $5.99 broken down into $4.58 for garment manufacturing; $4.60 for miscellaneous activities; $4.81 for government, $4.90 for hotel; $5.00 for retail, wholesale, and warehouse; bottling, brewing, and dairy workers receive $5.09 an hour; $5.16 for fish canning and processing; $5.23 for private hospitals and educational institutions; $5.40 for printing; $5.38 for tourism and travel; $5.41 for ship maintenance; $5.50 for construction; $5.53 for publishing; $5.75 for petroleum; $5.89 for finance and insurance.

Shipping and transportation has three classes with those in A (stevedoring, lighterage, and maritime shipping agency activities) getting $5.99; B (unloading fish) $5.82; and C (other activities), $5.78.

Puerto Rico also varies by industry from $5.08 to $7.25 while the U.S. Virgin Islands too follows the federal rate of $7.25 an hour except for businesses that have an annual gross receipt of less than $150,000 where $6.90 is used.