NewsWhore
03-07-2007, 06:10 PM
One of the leaders of the free zone industrialists and a spokesperson for the sector, Fernando Capellan was interviewed by reporters from Multimedios del Caribe, the publishers of El Caribe newspaper. During his interview, Capellan revealed how what he called "a mafia of lawyers" was exploiting workers and employers alike. As president of Grupo M, one of the larger free zone enterprises, Capellan denounced the existence of these law firms that encourage workers to claim liquidation payments and then purchase their rights. According to data collected by El Caribe, 95% of cases are settled in favor of the worker, while on a national scale the average is 65%. Capellan says that some adjustments to the Labor Code are needed in order to put an end to the problem of "extortion" that is threatening to bankrupt many of the smaller businesses in the Santiago industrial cluster.
According to Capellan, the Labor Code has been "hijacked" by some people and needs to be "enriched" in order to protect investors. The industrialist told the reporters that the code has fulfilled its original purpose and now needs to be reformed in order to create more jobs and prevent the huge number of labor cases that are being created because of what he calls a "bad interpretation of the law." He was particularly critical of articles 539 and 86 of the code.
For readers who don't understand the issues in question, Capellan explained that when the Santiago Free Zone began operations, the owners were mainly foreigners and when they went on vacation during December and January, they would liquidate their employees. When work resumed in February, the same workers would be re-hired. The process became a tradition and the annual "liquidation" of workers was considered a triumph for the workers. The problems arose when lawyers began to argue that workers who were "liquidated" in December and re-hired in February were, in reality, continuing in their jobs and if a factory was going to totally cease its operations or the worker was going to be fired, the owners should pay the worker compensation for all of the years that worker had been at work, despite being liquidated each year. These cases were upheld in the labor courts and this has forced the factory owners to create a labor reserve contingency fund of unproductive capital.
Capellan pointed out that this is one of the issues that need to be resolved in order for the free zone factories to continue in existence. He said that the DR-CAFTA agreement is a second step forward. The issue of the overvalued Dominican currency is the third step needed, and Capellan said that what the industrialists mean by this was not a devaluation of the peso but rather a stabilization and real market value for the currency. He reminded the reporters that the free zones experienced their greatest expansion during the period when the peso was at 3 to the dollar and 16 to the dollar. And the fourth step needed for the survival and recovery of the industry is the creation of a good lobby in Washington, D.C. to look out for Dominican interests.
More... (http://www.dr1.com/index.html#6)
According to Capellan, the Labor Code has been "hijacked" by some people and needs to be "enriched" in order to protect investors. The industrialist told the reporters that the code has fulfilled its original purpose and now needs to be reformed in order to create more jobs and prevent the huge number of labor cases that are being created because of what he calls a "bad interpretation of the law." He was particularly critical of articles 539 and 86 of the code.
For readers who don't understand the issues in question, Capellan explained that when the Santiago Free Zone began operations, the owners were mainly foreigners and when they went on vacation during December and January, they would liquidate their employees. When work resumed in February, the same workers would be re-hired. The process became a tradition and the annual "liquidation" of workers was considered a triumph for the workers. The problems arose when lawyers began to argue that workers who were "liquidated" in December and re-hired in February were, in reality, continuing in their jobs and if a factory was going to totally cease its operations or the worker was going to be fired, the owners should pay the worker compensation for all of the years that worker had been at work, despite being liquidated each year. These cases were upheld in the labor courts and this has forced the factory owners to create a labor reserve contingency fund of unproductive capital.
Capellan pointed out that this is one of the issues that need to be resolved in order for the free zone factories to continue in existence. He said that the DR-CAFTA agreement is a second step forward. The issue of the overvalued Dominican currency is the third step needed, and Capellan said that what the industrialists mean by this was not a devaluation of the peso but rather a stabilization and real market value for the currency. He reminded the reporters that the free zones experienced their greatest expansion during the period when the peso was at 3 to the dollar and 16 to the dollar. And the fourth step needed for the survival and recovery of the industry is the creation of a good lobby in Washington, D.C. to look out for Dominican interests.
More... (http://www.dr1.com/index.html#6)