“What is the justification for the proposed increase in Labor fees?” asked a local contractor during the Senate Labor and Employment Committee hearing this week with over 20 Palau contractors.

Draft Labor regulations circulating for public comments have triggered reactions from the public, especially the proposed increase in fees by 100% over current fee levels.

“Gov’t should help ease the process for getting workers or lower fees at this time, especially while we are recovering from this pandemic,” expressed Vance Polycarp, a local contractor, during a hearing with Senate Committee on Labor and Employment this week.

Pre-covid, Palau’s foreign labor force was at 6,900; in 2022, it is a little over 2,000, meaning that Palau had lost nearly half of its Labor force.

Mr. Polycarp added that with current Labor regulations, it is difficult to get workers now because of external issues such as greater involvement of the Philippines POEA than before COVID, and the proposed regulations will make this even more difficult.

Increased fees and increased costs will only be passed on to the consumer, expressed another contractor.  “Expect the price to go up with the fees.”

The cost of goods has increased due to inflation and other factors outside Palau’s control and is now compounded by Palau Goods & Services Tax. As proposed, an increase in Labor fees on top of recovering economy will not help Palau recover as quickly as it needs to, expressed a local business owner.

Senate President Hokkons Baules said that the congress has expressed their concern about the proposed regulations to Minister Ngirai Tmetuchl of HRCT&D and asked him to hold off on the regulations. 

Minister Tmetuchl confirmed that they have met with OEK but that they will need to get President Whipps decision on whether to go forward and hold off on the regulations.

“This is a comment solicitation period.  Everyone with concerns can make comments and send them in. We don’t comment on the comments.  We are just trying to address people’s concerns through this regulation,” said Tmetuchl.

Committees of both houses of OEK commented on the proposed regulations, recommending that the draft regulation be reviewed by a legal counsel for compliance with the statutes, for internal conflicts, and to maintain minimum quality standards.

“We believe that these new draft regulations would hinder, rather than help, public understanding of the law,” the OEK Committees joint letter said.

Leave a comment

Your email address will not be published. Required fields are marked *