Guarantees
pp. 33-34 · Read in the full issue
Those Native Labour Guarantees Plea For Attention to New Guinea Miners' Problem
By “Nosavi”
rE Native Labour Ordinance of the Territory of New Guinea demands that employers should pay to their labourers a proportion of their wages monthly, and that the balance be defer red till the determination of the con tract. The amount payable monthly must not be less than 1/-, nor more than 50 per cent, of the total wages payable.
To ensure that the employer will meet his oDUgations, the Administration de mands U) that the employer should possess realty or tangioie assets, such as a fixed deposit (reieaseable only by the Administration) of sufficient value to cover the wages, or (2) that the amount be paid into an Administration “native deferred pay trust fund”, whence it will be refundable (without interest) at the termination of the con tract any time up to three years hence, or (3) —and the worst of the three alternatives —that the employer provide a guarantee covering the amount of deferred wages, also native labour tax at the rate of 1/- per month for every month in which the tax is not suspended. (It has been suspended from July 1 to June 30 each year for the last five years). Further, it must embrace the possible costs of repatriating the labourer to his village.
A well known insurance company, dealing extensively m tnese guarantees win, lor a premium at tne rate of lu per cent, of tne amount to be covered, issue such a guarantee. The “catch” comes wnen the employer is unable to pay off his labour from his own resources, in such cases, the Administration will pay on and repatriate tne natives, and ciaim on the guarantor who, of course, is nabie and pays up.
The course of events, after such a proceedmg, is lixe unto a stone tossed in a stffi pool. Seemingly, in all cases the Administration will issue a summons agamst the employer, usually under section 57 (7) of the Ordinance, for “failure to pay deferred wages in full upon determination of the contract”.
Notwithstanding the fact that the em ployer is financially unable to meet his obligations, and that the payment of the amount is guaranteed, the Administra tion kicks him while he is down.
The insurance company (as guarantor) then a civil claim, in the Dis trict Court, for the amount which it has been called upon to pay out on behalf of the employer, and gets a judgment against him, with costs.
The employer gets all the kicks, and none of the ha’pence. He pays a high premium for a guarantee, which actually gives him no security. His reputation is sullied by a conviction under the Ordinance, and he has to foot a bill for the full amount, plus costs.
Here is an example of the whole thing:— A native is signed on for two years, at 10/- per month; 5/- payable as cur rent wages, and 5/- deferred. The de ferred wages amount to £6, and tax from July 1 next following the date of signing, on the termination of the con
tract, may be about £1; repatriation may be assessed at £2; a total of £9, for which, if a guarantee is needed, 18/premium is payable.
On termination of contract, the native should receive his £6, and it may cost £l/10 - to repatriate him. Probably, the tax has been suspended for the whole term of the contract. £7/10/- is needed.
The employer cannot pay. Then the above procedure is followed and, in the ensuing prosecution, the employer may be fined 10/- or £l. One employer, who defaulted, was fined £lO per labourer by a magistrate who apparently was doing his bit to help balance the budget! The employer also is out of pocket to the tune of the 18/- premium and the costs as assessed by the court in the civil claim.
It is high time that some steps were taken to protect wholly honest but un fortunate miners suffering from a run of bad luck, or other employers, perhaps temporarily unable to find the ready cash (often a large amount when a big line is concerned) with which to pay off their labourers.
The amendments could well embrace the payment of interest on amounts paid into the trust fund, and freedom from the stigma of a conviction by a court for what in the majority of cases the em ployers have striven their utmost to avoid —viz., default in their obligations to their labourers.
A policy that will involve the person guaranteed in a prosecution and a civil judgment is doubtful value for a 10 per cent, premium charge.
M. Casimir, formerly French Resident Commissioner in the New Hebrides, who returned to France early last year, is now in Africa, in command of a military group at Soudan.