'New labor law includes best practices from US experience'

st-Sunday November 18, 2007
Local
Saturday, November 17, 2007



Last of a four-part series

Editor's Note: The following is a press release issued by the Office of the Governor. It is being published as a series due to its length. Previous sections of this release were published on Nov. 14, 15, and 16, 2007. Visit the Archives section of www.saipantribune.com to see the previous sections.

Lifting of the restrictions on hiring in certain job classifications: In the past, certain job classifications were either reserved entirely for citizens and permanent residents or reserved on a one-to-one (citizen to foreign worker) employment basis. This created inflexibility that hampered some businesses in responding quickly to opportunities in the marketplace. These restrictions have been removed in the new law and replaced with more flexible incentives and weighted advertising requirements designed to achieve the same objectives.

Phase-out of the moratorium: Chapter 3 of the new law phases out the moratorium that was imposed in 1999 when foreign workers were coming to the Commonwealth in very substantial numbers every year. Circumstances have changed. There is a pool of qualified foreign workers in the Commonwealth, so new arrivals are at a relatively low level. The moratorium imposed artificial restraints on business hiring that are no longer necessary. The need for Commonwealth businesses to remain competitive in the Asian market requires that unnecessary controls be removed.

The moratorium will be phased out over a three-year period. In the first year, the visitor industry will not be subject to the moratorium. In the second year, the moratorium will no longer apply to the services industry; in the third year the moratorium will no longer apply to agriculture, fishing and related occupations; and the moratorium will expire entirely by Jan. 1, 2011.

In place of the moratorium, the Commonwealth uses a preference for on-island workers. These workers have first opportunity to take available jobs that cannot be filled by citizens and permanent residents.

Affordable health insurance for foreign workers. The new labor law requires that employers provide medical insurance coverage for their workers, and gives employers three options for providing this coverage. This is a departure from current law which makes employers responsible for medical costs incurred by their foreign workers, but not necessarily by way of insurance coverage. Large employers can self-insure as they now do; some employers can use their own existing insurance coverage as some now do; but a low-cost pool is provided for everyone else. The pool option provides full coverage for a low monthly payment to CHC . This is a very creative solution which will have two significantly positive results: It will make affordable insurance available to employers of foreign workers; and it will provide critically needed funding to CHC. This will allow protection for the employers of domestic workers for whom commercially-available health insurance is often too expensive. The new law provides a transition period, during which existing legal requirements for medical care for foreign workers remain in effect, while new regulations are worked out by the Secretary of Public Health with extensive input from the business community.

Defined time for filing of worker complaints: Under the new law, complaints by foreign workers must be filed within six months of discovering the alleged wrong and in any event within 30 days of the end of the contract period. This will prevent complaints from being brought long after employment has ceased when records and human resources personnel may no longer be available for the employer's defense. Service of process by the Department may be accomplished by publication which will help prevent the accumulation of case backlogs.

Streamlined handling of the periodic exit: The regulations under the new law will provide a procedure under which a period of 60 days absence from the Commonwealth may be substituted for the six-month period required by law for qualifying employers and qualifying foreign workers.

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This legislation was the result of more than a year's deliberation by the Commonwealth Legislature, CNMI employers, and representatives of foreign workers. It was the subject of public hearings and many consultations with business and foreign worker interests. None of the affected parties agrees with all of the legislation's provisions. But the CNMI Legislature - by unanimous vote on three separate occasions - concluded that the legislation constituted a fair balance of the competing interests and would greatly benefit the Commonwealth's economy, its citizens and permanent residents, and its foreign workers.