Oyster Bay Beach Resort workers win injunction over their salaries

OYSTER POND–Eighteen workers at Oyster Bay Resort on Wednesday won an injunction filed against their employer Iron Shore Management N.V. over payment of their salaries from October 1, 2017.

All workers concerned were in indefinite paid employment at the Resort, which was severely damaged by Hurricane Irma on September 6, 2017. The Resort has been closed since, but will reopen again as per June 1, 2018.
The 18 employees in question had not received any salaries since October 1, 2017. After several rounds of negotiations with the union Workers Institute for Organised Labour (WIFOL) the Resort employees received a proposal concerning payment of salaries equal to a 32-hour workweek for the months September, October and November 2017.
In December 2017, they were to receive 40 per cent of their regular salaries, 30 per cent in January 2018, and 20 per cent from February 2018 until the reopening of the Resort, for as long as they were available for work on call. If they would be called in for work they would be paid for every worked hour above this minimum guaranteed salary.

Mass dismissals
To prevent mass dismissals, Oyster Bay made a second proposal to the union, which entailed that workers could remain in employment without pay. This would enable them to find employment outside the Resort until reopening, after which they could resume their duties against regular payment.
Every worker had the opportunity to choose one of the two proposals. Of 93 employees, 69 chose the first option and 18 did not agree with any proposal and initiated summary proceedings.
Until February 1, 2018, their employer offered shelter, water and food to those in need among these 18 workers. Through crowd-funding the resort raised US $165,491 for workers in need as a result of the hurricane. The 18 employees were also able to follow hospitality training for which they were to receive a monthly stipend of NAf. 1,000.
However, the workers did not respond. They also declined invitations to work elsewhere against payment of $7 per hour.
In the injunction, the resort workers claimed payment of their customary salaries from October 1, 2017, with legal increases and interest. Their employer called on the Court to reject the claims.
The Court established that workers had not received their October 2017 wages and only part of their September 2017 salaries, even though the failed negotiations with the union continued until November 1, 2017. Considering this, the Court stated that workers were entitled to their full salaries for these two months.
The Judge also agreed with the employees that their employer had defaulted in ceasing payment of salaries after the 18 workers had declined the initial proposal.

Special provisions
“It is true that special provisions can be made in times of need and employees can be required to temporarily settle for reduced primary terms of employment (such as pay and working hours), but it is contrary to the principles of good employment practices to no longer pay any salary at all to employees who refuse to agree to their employer’s proposal,” the Judge stated in the verdict.
“That is not a proper method of negotiation because it amounts to abuse of circumstances, particularly of employees who were affected by Hurricane Irma,” he added.
The Judge agreed with the Resort, represented in summary proceedings by Assistant General Manager Annemarie Brooks and Human Resources Director N. Brown, that the damage caused by Irma was sufficient grounds to propose a change in the 18 workers’ primary labour conditions. However, the question is what should be considered a reasonable proposal, the Judge stated.
According to the workers, it was difficult for them to ascertain whether their employer’s holding companies and shareholders are investing in the Resort to such an extent that a considerable cut of their wages would be justifiable.
They said their employer is financially stable and would be capable of paying their full salaries. Their employer had stated that the Resort is “running break-even,” time-share owners would be willing to invest $3.6 million and the company is covered by business interruption insurance. The workers contested claims that the Resort would only receive a maximum $5 million from the insurance company.

‘Drastic adjustments’
The Court agreed that the Resort’s proposal to workers was insufficiently transparent and insufficiently motivated, especially because it concerned “very substantial” salary cuts.
Annual accounts, a specified damage report with valuation documents, a motivated insurer’s statement about pay-outs, a liquidity forecast, and a detailed reconstruction plan were missing but were indispensable for such “drastic adjustments” to labour conditions, the Judge said.
“In the first place, it concerns the employer’s entrepreneurial decision to continue to operate the Resort despite the devastation. After all, the employer will only do this if they expect to make a profit after the reconstruction of the Resort.”
The employer has failed to make sufficiently clear whether it was reasonable to require employees to receive much less wages, the Court said. “To put it bluntly, the higher the wage sacrifice, the faster the employer will make a profit again. By not presenting the data, or at least very limited, the employer does not enable the Court to properly assess the reasonableness of the proposal in this summary proceeding.”
Taking the devastation of Irma into consideration, the Judge deemed it reasonable for the 18 employees to agree to a 25 per cent reduction in wages as per November 1, 2017. Their employer was ordered to pay, from November 1, 2017, at least 75 per cent of their usual wages, to be increased with the statutory increases, maximized to 10 per cent, and statutory interest.
Where the salaries of September and October 2017 are concerned, the Court said workers should receive their regular wages, to be increased with the statutory increases, maximized to 10 per cent, and statutory interest.
The Court said it would be a good idea for the Resort and its workers to initiate a court case on the merits in which the workers could try to obtain full payment of their salaries, whereas their employer could try to convince the Judge of the reasonableness of its proposal to pay less.
“It would even be better if the employees, the union and the employer start negotiating with each other,” the Judge concluded.

Source: The Daily Herald https://www.thedailyherald.sx/islands/76275-oyster-bay-beach-resort-workers-win-injunction-over-their-salaries