Good morning, Mr. Speaker.
I am pleased to rise today to inform Members of this Honourable House that today we have made a minimum wage in Bermuda a reality. Our people deserve it. They deserve to enjoy decent work and fair compensation.
The Employment (Minimum Hourly Wage) Order 2023 (the “Order”), which was tabled today in this Honourable House, sets the minimum hourly wage rate for Bermuda at $16.40. The Order is due to take effect on 1 June 2023 and employers of low-wage earners will be required to amend their contracts and/or statements of employment to ensure that they are compliant with the Order by 1 June 2023.
Mr. Speaker, as highlighted in the 2020 Speech from the Throne, this Government has made a commitment to the workers of Bermuda to ensure they receive a dignified wage which will allow them to cover their basic needs. This is a promise we have worked diligently and deliberately to implement. It is this Government’s desire to provide adequate social protections to all Bermudians, and establishing a comprehensive minimum wage is fundamental to ensuring that we progress as a just and equitable society.
Mr. Speaker, the International Labour Organization or ILO as it is commonly referred to, defines minimum wage as, “the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period, which cannot be reduced by collective agreement or an individual contract.”
Most modern, developed countries have a minimum wage regime. More than 90% of countries designated as ILO member states currently have a statutory wage scheme of some sort. Considerable evidence-based studies have outlined the many benefits realized by both employers and employees in countries where a minimum wage has been instituted. Minimum wages will assist in:
- Promoting fair compensation for employees;
- Improving an individual’s quality of life;
- Preventing the exploitation of workers; and
- Preventing working families that are below the poverty line from receiving what many would consider being unlivable wages.
Mr Speaker, In April 2021, the Wage Commission provided the Minister responsible for labour with its report which detailed its recommendations for a minimum hourly wage rate in Bermuda. The Wage Commission determined that building a wage floor would protect Bermuda’s labour force, especially those within low-paid occupations, such as hospitality, horticulture and domestic work.
In August 2022 the Ministry of Economy and Labour published a Position Paper entitled Establishing a Minimum Wage in Bermuda, which outlined, among other things, the three recommended options of the Commission, what a minimum wage is, why it is needed in Bermuda and the benefits to establishing a statutory minimum hourly wage rate.
Mr Speaker, the Order provides for a hybrid payment structure for employees who receive commission, gratuities and service charges. These employees will receive a basic wage, set by their employer, to which service charges, gratuities and/or commissions will be added, to guarantee a minimum hourly wage rate of $16.40. Where an employee’s basic wage plus service charges, gratuities and/or commission does not equal the minimum hourly wage rate of $16.40, their employer will be liable to provide the difference. This guarantees that an employee will receive the minimum hourly wage rate for every hour worked.
Mr Speaker, the Employment (Minimum Wage Entitlement) Act 2022 sets out the guidelines for who is entitled to receive a minimum hourly wage and the enforcement provisions regarding adherence to the payment of a minimum hourly wage rate, among other things. Additionally, it gives Labour Inspectors the authority to investigate an employee’s complaint against his employer and issue enforcement notices to employers who have failed to correctly remunerate their employee pursuant to this Order.
Mr. Speaker, many jurisdictions view minimum wages as a vehicle to take the lowest paid out of poverty. Others view minimum wages as a wage floor, below which employers are not permitted to pay. Regardless of the approach, this will improve the lives of many workers, especially those within occupations with traditionally low levels of remuneration. Any business currently operating with a business model that is predicated on poverty wages should seek to change its business model.
Mr. Speaker, in closing, I would like to take this opportunity to thank the Wage Commission and the team within the Ministry of Economy and Labour for the work executed to make a statutory minimum wage in Bermuda a reality.
Thank you, Mr. Speaker.