Audio: Q&A On $11 Million Redundancy Payment
A question and answer session was held in the House of Assembly, with Opposition MPs questioning the Finance Minister on the $11 million to cover the redundancy payments due to Fairmont Southampton workers.
This follows after the Government previously confirmed that they will step in to assist Fairmont Southampton workers who are waiting for their redundancy payments from the company, making “loans to employees equal to amounts due to them in redundancy, which will require repayment once sums are paid by Gencom.”
The redundancy loan payments — which were initially supposed to be made by the company on October 23rd — cost the Government a total of $11 million for 714 positions.
“There is no agreement between the Government of Bermuda and Gencom,” the Finance Minister said. “What does exist is an agreement between each employee who received redundancy and the Government of Bermuda.”
When asked if Gencom cannot find the funds to pay the workers, how will they find the funds to renovate the hotel, the Minister noted the impacts of the pandemic on the tourism and financing markets.
“I would say that there has been some challenge in respect of finding appropriate financing sources at prices for which investors or operators are prepared to pay,” the Minister said, adding that “it is my understanding that the owners are exhausting their options to find appropriately priced capital to move this project forward.”
The Minister also reiterated that the Government “will pursue any remedies available to it” to recoup the funds, adding that they “will take legal advice, and will be guided by that advice in taking whatever appropriate steps are deemed necessary to get the money back.”
Bernews has reached out to Gencom via email seeking comment and we have not yet heard back, but will update if able.
Update 1.10pm: The Finance Minister is actually speaking on this topic now, providing more information, you can watch the live video here.
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This could have been handled so much better with very little effort. .
Why not assist workers by loaning 1/2 the amount or less with the hopes that Gencom will pay soon. Why put the all taxpayers at risk to help a few.
Why was it impossible to have Gencon sign a document saying that they will pay , and until they did, planning permission to renovate will not move forward.
Instead they have an agreement in place with staff and will seek legal advice if necessary to recoup funds? I wonder what that will cost. Good luck getting money from people that have left and are leaving the island.
The PLP are so quick to point out, and regurgitate the flaws in previous governments but seem to rush and hand out free money.
What is very interesting and telling is the PLP’s response to the failure of a private company to fulfill their legal requirements for redundancy packages.
For a while now the PLP have lambasted companies (such as the banks) for enacting redundancies despite them paying severance packages above the legal requirements and on time.
However, for this instance they paid all of the claims for Gencom and have never once criticised them for failing to adhere to the law. Very strange for a labour party to stay silent on this matter (especially given their bombastic language towards other companies in the past).
Makes one wonder if the rumours are true, hence why the PLP will not hold Gencom to account.
I agree. Something is not right.
Why are they continuously operating under good faith instead of pursuing signed agreements? If they seek legal counsel, they will get laughed at as there is nothing legally binding this loan to gencom.
What I’m hearing from the Minister, is the the employment act is the LAW…And the Gov’t will not be repeating itself with regard to this. It’s at GENCOM’s best interest to ensure repayment or watch their company’s slow and painful demise.
You mean handle like the crackerjack airport deal and the 185 million the oba signed off on for Morgans Never Land Hotel. It’s know wonder your own didn’t support you last election. You have a dysfunctional 6 party and the only person who’s talking is Sour milk Dunkely.
Please throw your electronic device overboard. The oba could sacrifice puppys on an altar and still wouldnt come close to the high f$&@ery that the plp is responsible for. Good attempt tho……. bermuda will never ever NOT be up to our ears in debt thanks to one party and one party alone. Your belived pee el pee
The plp is appealing to the UK to allow them to discriminate against some Bermudians.
How anyone can support this is beyond me….the same people who claim to be oppressed and doing their best to oppress a small group of people.
““There is no agreement between the Government of Bermuda and Gencom,” the Finance Minister said.”
That is perfectly consistent with what the Minister has been saying all along.
“What does exist is an agreement between each employee who received redundancy and the Government of Bermuda.”
That is NOT consistent with what the Minister has previously said. What the Minister previously said was this:
“The Minister told BBC today that “government will not be looking to the employees for repayment of these amounts, the government will looking to Gencom to honour their obligations to their employees,” adding that “government will exhaust all of the available remedies to get the money back, including going to court.””
If in doubt, see here: https://bernews.com/2020/11/govt-11-million-in-redundancy-payment-loans/
Don’t be mislead by the headlines!!
The fact is that all employees are legally owed redundancy pay (as prescribed by the Employment Act) from the new owners of the Fairmount Southampton. If the new owners do not pay, they can be pursued in Court, the same as any other employer.
What the Government appears to have done is act in an abundance of caution to ensure all employees (most of whom are our fellow Bermudians) were not left without money to cover basic necessities including food and rent.
In summary, Government is now substituted for the employees. They may therefore have to go to Court to get the funds but their entitlement to the funds is already established by virtue of the Employment Act.
As an additional note – the Government has an assignment of each amount paid. They will therefore be paid instead of the individual employees. Therefore, there is no additional risk if the employee is in Bermuda or overseas when the payments are eventually made.