Large corporations, not small enterprises, are bearing the brunt of Barbados’ minimum wage increase, according to the body representing small businesses, which has rejected claims by the island’s leading business lobby that the rate adjustment has severely impacted micro and small firms.
On Monday, the Barbados Chamber of Commerce and Industry (BCCI) highlighted the challenges now facing micro and small enterprises. President Paul Inniss said that while big businesses have largely been unaffected, already offering wages above the new minimum, “some of the smaller businesses are impacted in a significant way”.
But Chief Executive Officer of the Small Business Association of Barbados (SBA), Dr Lynette Holder, countered that most small enterprises are not being adversely impacted by the increase in the minimum wage.
“The facts are, large fast food chains, and large retailers and so on, these are the ones that I would posit, are really challenged by an increase in the minimum wage, and not small firms. I would wish persons not to use small businesses as a scapegoat, because it is not true, it is not factual, it is not grounded in research,” Holder told Barbados TODAY on Wednesday.
“Back in 2021, I think it was, when the first minimum wage was introduced, you had major fast food chains paying $5 and $6 an hour. Small businesses—many of them… retail, cleaning firms, even the very small security firms and so on—were paying their staff even more than that,” she contended.
“So when it was established at $8.50, there were already a number of small businesses that paid that and even higher. That’s what the research said. So, here we are, fast-track a few years later, going from $8.50 to $10. Again, the majority of [small] businesses said that they had no objection to the increase. One-third of those we polled said keep it at $8.50.
“So… sounding an alarm and seemingly wanting to paint the small business sector with this proverbial brush, is unfortunate, and an inaccurate reflection of the reality.”
Acknowledging that the cost of living in Barbados is too high, the SBA CEO suggested that the focus should be on working to lower that, as well as the cost of doing business generally.
She said: “There are a number of factors that affect this, and it is not the wage. At the end of the day, we want a country where we can pay our employees a decent wage, a liveable wage, so that they can sustain their lives and their families and their livelihoods.
“So, there are other issues we should be looking at, and I wish the national conversation would focus on that… how can we improve the cost of doing business, how can we work at bringing down the cost of living in our country; let us address the issues of the port, the long periods of time that goods are kept sometimes in the port, incurring significant costs, which the bigger businesses then sometimes pass on to the customers to recoup their costs.”
Holder said one could not talk about having a just society if the wages paid to workers do not reflect their economic realities.
In making a case for her members, she said she did not know of any small firms which would object to paying their employees a “decent, liveable wage”.
“In fact, the research shows that you get a higher level of employee retention when you give an attractive wage, an attractive emolument to your staff. So, I think the conversation really needs to change from this blame on the small business sector… and I call it, hiding behind other issues. Let’s confront what those issues are,” the SBA head declared.
Addressing the impact of the new minimum wage on Monday, General Secretary of the Congress of Trade Unions and Staff Associations of Barbados (CTUSAB) Dennis De Peizacalled on businesses to avoid shedding jobs or slashing hours, even as it acknowledged the sector’s struggle.
He urged employers to “try as far as possible to retain the staff and look for appropriate strategies [to] reposition their businesses so that they can make or continue to make the margin of profits that they have had over time, or increase on them, so that there is no need for the reduction of hours.”
Shireene Mathlin-Tulloch, chair of the Intimate Hotels of Barbados (IHB), which represents 38 small, Barbadian-owned member properties, told Barbados TODAY this week that while nobody has had a problem with the minimum wage, a new challenge has arisen with workers in higher wage brackets now seeking increases, even though no immediate budget exists for further rises this year.
“It [the minimum wage] has closed the gap between those positions and the one above. So, the people… in the wage group just above, they are all now looking for increases… because some of the increases from the minimum wage [put previously lower paid workers] at the same place as the categories above,” she explained.
emmanueljoseph@barbadostoday.bb
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