The question of how much factory workers in Haiti’s expanding garment industry should be earning for an eight-hour work day was settled this month after Haitian President Michel Martelly issued an executive order raising the minimum wage.
Based on current exchange rates, the increase from 200 Haitian Gourde to 225 Gourde (U.S. $4.44 to $5) is a 12.5 percent increase, but currency devaluations make the boost equivalent to only an 8 percent hike in U.S. dollars, which is widely used in Haiti.
“Salary increases without further social services, health, education and transportation provided don’t mean anything,” said Georges Sassine, general manager of Lafito Industrial Free Zone under construction on the northern outskirts of Port-au-Prince and former president of the association of industries of Haiti. “It’s just a continuation of the same.”
A recently published report by Solidarity, the nonprofit affiliate of the American Center for International Labor, said based on the cost of basic expenses and a basket of food items, a garment worker in Port-au-Prince needs to earn $23.12 for an eight-hour day to support a family of four. Rather than speak of a minimum wage, the report talks of “a fair wage.”
The pay boost is not only less than what Solidarity has outlined, but also far less than the $11.11 protesting garment workers have asked for in recent months as they forced some factories in the capital to stop production.
Yves Savain, the executive director of the commission overseeing the U.S. HOPE legislation that provides preferential trade benefits to Haiti’s apparel sector, said he believes the increase will quell demands. In recent days, the wage council has started talks with workers and union organizers to address their concerns.
Savain said because Haiti’s apparel industry is still relatively small but growing, it can sustain the pay increase. He doesn’t expect the increase to have any adverse effect on the industry. Most of exports now under HOPE and HELP are knits made of blended fabric mainly from Asia. Some Haiti garments have duty-free access to U.S. with fabric from any country in the world.
A recent report issued by Better Work Haiti showed that 39 percent of Haiti’s nearly 30,000 workers were already earning more than the $4.44 a day minimum and 29 percent earned $6.66, according to the report monitoring working condition in Haiti’s apparel industry.
The U.S. Congress retained Better Work to certify if the trade benefits it provided Haiti should continue, or if corrective actions are necessary.
But Savain and others worry that any additional increases, as some lawmakers and workers have been seeking, could put an impoverished Haiti at a disadvantage. The country’s efficiency and productivity are already lower than other nations with a thriving apparel industry.
“Right now, we are a little higher than Vietnam or Nicaragua, and our productivity is nowhere near their output,” Savain said.
With one of the highest unemployment rates in the hemisphere, Haiti has struggled to attract investors to create jobs. For example, the Caracol Industrial Park in the North has 3,060 employees and six companies — far less than what the U.S. and others anticipated when they backed the construction of the $300 million park after the Jan. 12, 2010 earthquake.
The park was forced to shut down Monday and Wednesday, and half a day Tuesday after protesters took to the streets because of the lack of a road. The CODEVI industrial park on the Haiti-Dominican border has also lost productivity due to sporadic protests over the lack of electricity in the city of Ouanaminthe.
Not everyone supported Martelly’s decision to issue a presidential decree that also clarify how much workers in other private employment, including household servants, should earn.
Sen. Steven Benoit, who led the battle to get Haiti to pass a minimum wage for its garment industry in 2009, took to the airwaves soon after learning that a decree had been published. He accused Martelly of sidestepping parliamentarians.
Government officials, however, have defended the president’s decision saying that it was based on recommendations of Haiti’s Wage Council, and came after numerous requests over the years by the U.S. government, factory owners and potential investors for clarification on the ambiguously written law.
The lack of clarification and controversy over the law’s language has triggered criticism from local and international union organizers that Haiti’s factory workers were being cheated out of what they are owed. The lack of clarity also prevented investors from making firm decisions.
“The only way to grow the number of workers is if investors perceive there is stability in wages,” Savain said.