Dionne Rose and Debbie-Ann Wright, Gleaner WritersDR. NOEL Cowell, lecturer at the University of the West Indies has proposed that social partners in the labour market seriously consider the idea of a Redundancy Savings Fund.
Dr. Cowell made the proposal in a preliminary report on the Employment Termination and Redundancy Payments Act, which was submitted to the Labour Advisory Committee (LAC).
Labour Minister, Horace Dalley, last year commissioned the study. But the proposal of the fund has been met with mixed reaction, said Dr. Cowell in his report.
"Almost unanimously, the trade unionists interviewed did not see it as a proposal, which merited serious consideration," he said.
The unions were of the view that such a fund would undermine the social legislation put in place during the 1970s and may reflect an initiative intended to reverse the progress made by working people during the period, said Dr. Cowell.
MIXED REACTION
The reaction of employers to the proposal was however mixed. Some he said, saw it as one way of re-negotiating the redundancy formula and passing on some of the current cost to the fund.
"Other employers' representatives take the view that it is a good way of forcing employers to save for the prospect of a redundancy exercise, however they feel that workers should not be asked to contribute," he added.
Vice President of the Jamaica Confederation of Trade Unions, Helene Davis-White, in agreement, said employers needed to plan for redundancies by developing a fund specifically for that purpose.
She told The Gleaner/Power 106 News that employers must plan for redundancies in the same way they plan for other legal obligations.
Prominent businessman, Sameer Younis said there are many employees who have never stayed at a job long enough to be able to benefit from such a fund.
He said he would prefer to see in place an employment and redundancy termination saving scheme.
"The employer would pay two per cent and the employee one per cent of their salaries and that would be invested in one of the investment companies," he said.
According to Dr. Cowell, two Caribbean countries - Barbados and the Dominican Republic have established similar mechanisms.
In the case of Barbados, every employer is required to pay a "severance fund contribution", the amount is determined by the minister from time to time, the employer is paid a rebate of the amounts paid to employees on the occasion of redundancy.
The Dominican provision is similar where provisions are made for a contribution amounting to .25 per cent of the weekly salary of the employee.
