Exploring Minimum Wages in St. Lucia
One of our recent blogpost indicated that Saint Lucia’s real unemployment rate is over 30%. Another major concern with the Saint Lucia labour market is the absence of a minimum wage, as discussed in the comments section. Multiple administrations have promised that they will fight for Saint Lucia workers and fail to make any progress after they are elected. We will analyze the promises made by the current administration and why a minimum wage would benefit Saint Lucia.
UWP Manifesto Promises
The UWP 2016 manifesto stated the following:
· Resume the initiative to establish a minimum wage for the workers of Saint Lucia which was being pursued during our last term in government.
· Take actions targeted toward attaining minimum wage legislation to alleviate poverty rates and related negative outcomes among families.
The current administration has failed to pass any minimum wage legislation during their term. Instead, we have seen escalating poverty rates and associated negative outcomes batter the people of Saint Lucia. This is perhaps no surprise that Saint Lucia’s PM known as “formerly Savills’ man in St. Lucia” has focused on providing financing for foreigners to buy land in Saint Lucia as opposed to a minimum wage. From the US State Department 2020 Report “There is no formal national minimum wage in St. Lucia, though a government-appointed minimum wage commission recommended establishing a minimum wage. Special legislation covers work hours for shop assistants, agricultural workers, domestic workers, and workers in industrial establishments.”
Minimum Wage Comparison in the OECS
Multiple countries within the Caribbean already have minimum wages established for workers
· Saint Lucia — Minimum wage for some sectors; EC$300 per month (EC$1.875 per hour) for office clerks; EC$200 (EC$1.25 per hour) for shop assistants; EC$160 (EC$1 per hour) for messengers
· Antigua and Barbuda — EC$8.20 per hour
· Dominica — EC$4.00 per hour.
· Grenada — Minimum wage schedules set pay by occupation; for example, the minimum wage for domestic workers, for example, was EC$4.50 per hour, while that for a security guard was EC$8.00 per hour.
· Saint Kitts and Nevis — EC$9.00 per hour.
· Saint Vincent and Grenadines — Set sector by sector; for example, EC$7 per hour for agriculture workers (shelter not provided); EC$5 per hour for industrial workers; and EC$3.125 per hour for household domestic workers.
Why is Saint Lucia’s mandated minimum wage even for the few sectors so much lower than all the other OECS islands? It is remarkable that minimum wage in Saint Kitts and Nevis is almost 10 times the minimum wage for a messenger in Saint Lucia.
Minimum Wage and Income Equality
A minimum wage can help to reduce income inequality and help the less well-off members of the society. “Another prime motivation for minimum wage policies is to reduce income inequality by improving the lot of those at the bottom of the wage distribution. Empirical studies show that minimum wage hikes do tend to narrow wage disparities, but only as part of a broader policy effort toward significant poverty alleviation.”
There is likely to be some opposition to any efforts to mandate a minimum wage from the Saint Lucia Employers Federation as seen in July 2016 “Executive members of the Saint Lucia Employers Federation are warning against a ‘hasty’ decision on a national minimum wage, while calling for government to move with alacrity to review the labour code.” However, after almost 5 years in May 2021, we have yet to see any decision from the current administration on a national minimum wage. Will the “businessman PM” ever enact policies that help the workers of Saint Lucia?
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