The Vanuatu Chamber of Commerce and Industry (VCCI) is disappointed and disturbed that the Government has refused to delay the proposed 36 per cent increase to Vanuatu’s minimum wage from June 1.
The VCCI President Antoine Boudier said in a statement that they are deeply concerned about how this decision has come about without any private sector consultation.
“And it leaves inadequate time to prepare for its implementation and we call on the Government not to proceed with gazetting of the Order,” he said.
He said the VCCI has asked to the Department of Labour (DoL) to urgently provide legal advice and practical guidelines on how the private sector is to effectively implement the imminent changes.
“In recent press statements, the Commissioner of Labour is reported to claim that the increase was supported by Vanuatu’s Tripartite Labour Advisory Council (TLAC),” he said.
“The VCCI corrects this inaccurate statement.
“The TLAC never approved this wage increase. Due process has not been followed.’’
It is worth noting that the VCCI is a key member of the TLAC, a government advisory group formed via the International Labour Organisation (ILO) in 2011.
It was mandated to guide Vanuatu’s development of new labor and employment policy. The TLAC’s membership is comprised of equal representation from employers, workers, and the Vanuatu Government’s DoL.
Mr. Boudier said the VCCI has participated in good faith in the Vanuatu TLAC.
“In the past, the TLAC has considered and deliberated proposed changes to the employment law of our country and reached consensus between all parties before the gazetting of any legislative changes that affect the people of this country,’’ he said.
He said that no direct consultations occurred with the private sector on the wage increase strategy.
“When the proposed 36 per cent minimum wage increase from 220VT to 300VT was announced two weeks ago, the VCCI expressed grave concerns about its likely implications not only to businesses but more so to the citizens of this country,’’ said Mr Boudier.
“Two groups of people will be most affected by this poorly considered minimum wage increase proposal. Low-income earners and unskilled unemployed people will be the ones worse off by this politically driven decision.’
He said two weeks after the announcement, the negative effects have already begun.
“Last week a large employer in town laid off 20 workers as it simply cannot afford the proposed wage increase from 1 June 2023,’’ he said.
He said the Chamber strongly advocates for the current Government to let common sense prevail and not proceed to the gazette of the Order.
“As presented time and time again, the private sector is not against an increase to the minimum wage and has been working behind the scenes and with the support of the ILO on a proposed approach that allows for collaboration, and more importantly, consensus,” said VCCI President Boudier.
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