PHILIPSBURG–Some 22 employees of jewellery chain Little Switzerland who were sent home without pay since December 2017 petitioned the Court of First Instance on Friday to order their employer to pay their due salaries, with interest, including a legal fifty per cent increase.
Little Switzerland’s holding company World Gifts Import B.V. pleaded with the Court to reject the claims. The Little Switzerland stores in St. Maarten suffered extensive damage due to Hurricanes Irma and Maria, which struck St. Maarten in September 2017.
Little Switzerland sells jewellery and luxury watches in more than 30 locations in the Caribbean, including in St. Maarten.
The hurricanes severely damaged Little Switzerland’s Front Street and Harbour stores, which led to no or hardly any turnover since. Whereas the Harbour store has partially reopened in the meantime, the Front Street store, which is currently under reconstruction, remains closed until July/August 2018, lawyer Daniella Engelhardt of Van Eps Kunneman Van Doorne law office stated on behalf of the company.
She said renovation of the Front Street store, which was severely infested with mould, would cost US $1.3 million.
After Irma, Little Switzerland paid wages to all its workers for a period of three months, as this was covered by the company’s business interruption insurance. As it had not been able to reopen its business and the three-month period expired on December 7, 2017, Little Switzerland said it was forced to suspend further payment of wages to all employees who are not working as of that date.
The company called a general staff meeting on November 28, 2017, during which employees were presented with the option to terminate the labour agreement, “seemingly in an effort to bid their workers farewell,” as attorney Jelmer Snow of BZSE law office said, or to stay in the jeweller’s employment, but without payment of wages.
In the meantime, the company said, it would be doing everything in its power to become operational again “as soon as possible, not only for commercial reasons, but also to be able to provide you with the opportunity to start performing your work again,” World Gifts Vice President for Human Resources Mike Cooney wrote in a letter to workers on December 8, 2017.
According to Little Switzerland, the principle of “no work, no pay” is explicitly set in the Civil Code of St. Maarten, and as it would be impossible for the employees to resume sales work and as the impediment to performing work in this case is not Little Switzerland’s fault, it is the employers’ position that this principle, which is also included in the workers’ employment agreement, applies.
Act of God
In most employment agreements the company has included a so-called calamity provision which states: “In the event the Employer is unable to make use of the services of the Employee – due to a calamity (fire, hurricane, rain, or any Act of God) or any occurrence beyond control of the Employer, whether or not for the risk of the Employer – for a period exceeding three months, the Employer will only be obligated to pay the applicable minimum wage to the Employee for said period. If such calamity or occurrence should last longer than three months, the Employer’s obligation to pay wages shall cease.”
Windward Islands Federation of Labour (WIFOL) contests Little Switzerland’s appeal to the “no work, no pay” clause and the resolutive condition in the labour agreements.
The union retained lawyer Snow, who confirmed that the main rule of “no work, no pay” is correct, but that Little Switzerland “seems to forget” that the employee who is willing to work retains the right to claim his wages if the employer does not make use of his or her services.
Snow pointed out an almost comparable situation after the passing of Hurricane Luis in 1995, in which the High Court of the Netherlands ruled that, although Luis was an Act of God and neither the employer nor the employee had any effect on its occurrence, the decision of the employer, in this case Port de Plaisance Hotel Operations N.V, to lay off some of its employees was not, and that, therefore, the clause in question was unlawful.
Attorney Engelhardt said it was no easy decision to keep the Front Street store closed. “This is a case of force majeure and does not concern a normal business risk. It concerns very exceptional circumstances with unforeseeable risks. Irma was extremely powerful, and its results also last for much longer. Never has the tourism sector been hit harder. It is very quiet on Front Street, even with the reopened stores.”
She said this in response to statements that other stores, including Diamond International, had already reopened and were back in business, whereas Little Switzerland is not.
The Court will give its decision May 15.
Source: The Daily Herald https://www.thedailyherald.sx/islands/75924-little-switzerland-workers-take-employer-to-court-over-no-work-no-pay-principle
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