Analyzing the Proposed Standard Hours of Work

First Published: 2000-08-05

The five proposed Labour Bills that will be considered by Parliament this session will impact tremendously on most businesses. Although the Bills are meant to provide a minimum set of standards, the most mature industry in The Bahamas, the Hotel industry, will also be hit with increased standards, such as paying staff for their meal breaks which they currently don-t pay, and doubling the amount of Sick Leave entitlement they will need to give starting employees.

Compared to current legislation, there will be increases in direct and indirect labour costs, as well as a marked increase in administrative costs to comply with the various sections of the proposed Bills. Much of the increased costs are extremely difficult, if not impossible, to quantify for any specific business. One of the least difficult provisions to quantify is the Standard Hours of Work.

Standard Hours of Work

Under current legislation the Standard Hours of Work is 48 hours over six days. Any time worked beyond those hours require premium pay of Time-and-one-half. There is also a daily standard of 8 1/2 hours per day. Any single day when the hours of work exceeds the daily standard, Time-and-one-half is payable. Any time worked on the seventh day requires payment of Double time.

The proposed Employment Bill will lower the Standard Hours of Work immediately upon becoming effective, then provides for a further reduction in the Standard Hours of Work in mid 2001. A major new cost is added from the effective date of the proposed Bill by providing in the Standard Hours the meal period of the employee.

Employers will be required to pay their staff for the time given for their meal period.

Upon implementation of the proposed Bill, the Standard Hours of Work will reduce to 44 hours over five and one-half days, inclusive of meal periods. Any time worked beyond those hours require premium pay of Time-and-one-half, provided that any time worked beyond the 4th hour of the sixth day receive the premium pay rate of Double time. Double time is also payable for any work done on the seventh day. There is still the daily standard of 8 1/2 hours per day for the first five days after which Time-and-one-half is payable.

On the 1st of July, 2001, it is proposed that the Standard Hours of Work be decreased to 40 hours per week over five days, inclusive of meal periods. The daily standard will be reduced to 8 hours. Any time worked over the daily or weekly Standard Hours of Work will receive the premium rate of Time-and-one half. Any work done on the sixth and seventh day will require the premium rate of Double time.

A Lessening of the Burden?

Consideration is being given by Government to reduce the rate of premium pay on the sixth day from Double time to Time-and-one-half. If this is done, it will be reduce the amount of increase costs to any employer who needs a six-day a week employee.

Cost Analysis

Normal working hours vary from industry to industry, as well as from company to company. Using three common work weeks currently in effect of 48 hours, 44 hours and 40 hours of productive time, spreadsheets have been prepared showing the increase in costs based on the assumption that the amount of hours worked today is the amount of hours needed by the employer to effectively run his business. There is also the assumption that the meal periods are currently not paid for. These spreadsheets are in Microsoft Excel format.

Do It Yourself Analysis

All Bahamian employers are urged to determine the cost increase to their business that will be caused by the proposed Standard Hours of Work. Two templates created in Microsoft Excel are available to help you make that determination.

If you determine that the increased costs will adversely affect your business, voice your concern to community leaders and your Member of Parliament. Write letters to the Minister of Labour and Maritime Affairs, the Honourable Dion A. Foulkes, M.P. and/or the Prime Minister, the Right Honourable Hubert A. Ingraham, M.P.

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