DOMINICA'S LABOR UNIONS STRUGGLING AMID ECONOMIC

UNCLAS SECTION 01 OF 03 BRIDGETOWN 000146

SIPDIS

DEPARTMENT OF LABOR, FOR ILAB

E.O. 12958: N/A
TAGS: ECON ELAB ESSO KHIV PHUM XL
SUBJECT: DOMINICA'S LABOR UNIONS STRUGGLING AMID ECONOMIC
DOWNTURN

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Summary
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1. (SBU) Dominica,s labor union leaders were surprisingly
upbeat in recent meetings, believing that Dominica,s
isolation and small economy with a strong agricultural base
will limit the impact of the global financial crisis on the
nation,s economy. Cruise ship arrivals are holding steady
at close to 500,000 visitors a year, and the only two
business-class hotels in Roseau report that occupancy is
holding steady at 90 percent and they have had no layoffs.
Eco-tourism hotels are also fully booked, although most of
them are small-scale operations. Despite this guardedly
optimistic picture, labor unions remain concerned with bread
and butter issues, including the rapidly rising cost of
living and the need to form an umbrella labor federation.
End Summary.

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Public Workers Union Seeking Creative Solutions
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2. (U) Public Workers Union General Secretary Thomas Letang
told Laboff that public sector workers are facing sustained
increases in the cost of living such that their salaries are
for the most part insufficient to make a decent living. He
pointed out that official salaries in Dominica are among the
lowest in the OECS, noting out that the PM makes
approximately US$2,400 per month. Public sector workers have
a GS-type salary scale with 33 steps plus five senior ranks.
The lowest paid worker earns officially ECD 1,031 monthly
(US$381). The GM said that low salaries play a role in the
perception that corruption is widespread. The recently
created Public Integrity Commission has not accomplished
much, he said, other than to receive financial disclosure
forms. Letang described the forms as largely fictional
listings of assets.


3. (U) The public sector union represents about 2,500 of the
5,300 public sector workers. The union engages in labor
negotiations every three years, with the next round this
summer. The last round led to a staggered 8 percent increase
over a three year period. The GM doubted that they will be
able to obtain such a large increase this time due to the
dire straits of the economy. He stated that the government
is suffering from reduced revenues due to a slowing economy
impacting upon tax revenues. He is looking at creative
alternatives, particularly improving benefits such as health
care coverage. As another example of the creativity shown by
the Public Sector Union leadership, the GM highlighted that,
in response to the government privatizing security services,
the union formed a company to compete for the contract and
won it. The guards that used to be government workers now
work for a private company, owned and operated by the union
at a profit. The profits go into the union coffers to help
defray expenses and help fund social welfare programs.
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WAWU Looking to Form a Federation
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4. (U) One of the distinctive features of the labor landscape
in Dominica is that there are six independent labor unions,
each focused on one segment of the labor market, and they
therefore do not always cooperate on areas of mutual
interest. They range in size, influence and ideology, with
the Workers Union being the largest, most diversified in its
coverage, and most moderate in its ideology. All told, about
50 percent of the labor force is unionized, with almost half
belonging to the public sector union. The government remains
the largest employer. The Waterfront and Allied Workers
(WAWU) Union represents the hotels, and financial sector, as
well as Ross University -- the largest private sector
employer on the island -- and workers in the port and cruise
terminal. In contrast to PSU's Letang, WAWU GM Kerstist
Augustus stated that Dominica was not doing that badly
despite the slowing economy, because its economy is still
agriculturally based with the tourism sector an important but
not dominant industry as it is in other neighboring
countries. Cruise ship arrivals, he said, are holding
steady, as are overnight visitor numbers. The hotels have
not had to lay off any workers. Construction is doing well,
with a number of large scale infrastructure projects
underway. (Comment: two of our AMCIT business owners, who
operate a quarry and a cement plant confirm that construction
is booming and they are very busy supplying cement to the
local business community. End Comment.) Mr. Augustus said

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he has offered to lead the way to forming a onfederation
with the other labor unions in Dominca and will be entering
into negotiations with tem soon. He, too, like the public
sector union eaders, is concerned with the rising cost of
livng and the need to moderate wage demands in upcomig
negotiations.

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Minimum Wage Up for Renewal
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5. (U) The minimum wage, last raised in 998, has been under
review for some time. The gvernment has referred the issue
to the social patnership committee, consisting of labor
unions, the government labor commissioner and the employers'
federation. The committee has not been able to gree on a
new standard due to opposition from the business community.
They opposed the proposed increases as too sharp. The unions
point out, though, that most workers are already making more
than the proposed new minimum. The committee is due to meet
again and the WAWU GM Augustus believes a new minimum wage is
likely to be adopted. The proposed minimum wage would be
ECD4.00 (US$1.48) for unskilled labor, ECD5.5 (US$3.30) for
clerks, and ECD5.00 (UD$1.85) for home assistants. He
pointed out that due to a shortage of farm workers and other
unskilled workers, Haitian immigrants are actually being paid
more than Dominican natives.

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Other Unions Struggling to Stay Relevant
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6. (U) Other unions, meanwhile, are struggling to remain
competitive and relevant to their membership. The National
Workers Union (NWU) is in particular trouble. It is the
oldest union on the island and dates back to the days when
Banana was the king crop on the island. Most of their
workers were banana plantation workers. Now that there are
only 900 banana farmers left and the industry has been
decimated, they have lost most of their membership.
Significantly, their hard-line Marxist ideology has also
largely lost it appeal. Solidarity with the Cuban and
Venezuelan revolutionary brothers and sisters is not a
compelling argument for joining the union as it once was,
according to WAWU GM Augustus. (Comment: Laboff has met with
the GM's of each of the unions, and felt that most of the
unions were pragmatic and interested in working with the
growing private sector. The NWU, however, seems stuck in a
time warp. The President, Rawlings Jemmont in one memorable
meeting last fall harangued Laboff, blaming the USG and its
policies for the collapse of the banana industry and the
general poverty of Dominica. He praised Cuba and Venezuelan
alternatives to US-led imperialism. End comment.)
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Comment
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7. (SBU) The labor movement reflects the underlying social
and economic trends in the island. The private sector is
beginning to emerge with significant incoming foreign direct
investment, particularly the arrival of MRB (the U.S. parent
company that also owns DOMLEC the electric company) to take
over the defunct cable television company, and the start-up
of a call center operated by Alpharetta, Georgia-based Clear
Harbor, which already is rivaling (American-owned) Ross
University in terms of employment. They provide over 300
jobs in Dominica alone, and have operations in Grenada and
Nevis and are looking at expanding into St Lucia. The
older, hard line Marxist-oriented labor unions are having a
hard time attracting members, while the more market-oriented
pragmatic unions like the Allied Workers or the Public Sector
Unions are gaining influence. One would predict that a true
labor confederation will emerge in the near future as a means
of stabilizing union influence in Dominica. The days when
Banana was King and the Marxist NWU was powerful are long
gone.


8. (U) In a side meeting, Julian Johnson, the head of
Dominica's new Public Integrity Commission said that the
Commission would greatly appreciate the opportunity to go to
DC and at least one other state to meet with agencies
involved in public corruption investigations. He
acknowledged that the financial disclosure forms currently
being submitted by local public figures are probably highly
inaccurate. Until such time as the commission can learn how
to interpret financial forms for evidence of misreporting, it
is unlikely that government officials will take the exercise

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seriously. Post is following up to try to arrange a VVP or
other appropriate training opportunities, including possible
training programs that might bring trainers down to Dominica.
We also are looking at possible training programs
coordinated with the State Partnership Program and have asked
FAVACA, the Florida Association for Volunteer Action in the
Caribbean and Americas, Florida's state version of the Peace
Corps, for assistance as well.
HARDT