Published On: Tue, Jun 19th, 2018

Legislative proposal with regards to sick days payment will negatively impact our economy

WILLEMSTAD - Curaçao Business Association (VBC) and Curaçao Hospitality and Tourism Association (CHATA) have taken note of the announcement by the Minister of Finance that was confirmed by the director of SVB to significantly increase the required number of days an employee has to be sick before SVB pays out the sick days (the so-called carens dagen problem). The Minister talks about 10 days, while according to the director of SVB this has been increased to 6 days.

The reasons for doing so are to cover deficits of the "ZV" that, according to the Minister, is caused by misuse of the law by employers.

The accusation of the Minister is serious and the VBC and CHATA wonder what the accusation is based on. Has the Minister carried out a thorough investigation? Neither the VBC nor the CHATA are aware of these practices and reject this accusation unless the Minister can substantiate them with facts and figures.

VBC and CHATA do not approve of the proposal to significantly increase the "carens dagen" (Sick day payment), which would mean that employers will soon have to pay for 6 days instead of 2 sick days, for the following reasons:

- It will lead to a drastic increase in labor costs;

- Deterioration of employment opportunities

- Negative impact on labor productivity that has been declining for years;

- Increasing the work pressure of fellow employees;

- There is a big chance that these additional costs will be transferred to employees who then have to take out expensive AO insurance

- Increasing the administrative and legal costs;

- Further rigidity of the labor market and legislation;

In short, the investment climate will deteriorate substantially because of these factors, while it is known that there has been no or marginal economic growth for years, unemployment is on the rise and incomes are falling.

Increasing the burden on employers and possibly employees will further deter economic growth and purchasing power with all the consequences for employment and prosperity on Curaçao.

The "ZV" fund also does not benefit from economic contraction because of shrinking of the base (less employed people). The solution of deficits in the ZV fund should be sought in improving the efficiency and regular checks performed by the SVB.

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