By *Jomo Sanga Thomas
(“Plain Talk”, July 31, 2020)
Did Finance Minister Camillo Gonsalves misstate the law when he said neither Sandals Resort International nor the government owes the workers who were employed at Buccament Resort? The law as outlined in the Protection of Employment Act and the National Insurance Service Act contradicts what a smiling Camillo Gonsalves told a nation last week.
However, Gonsalves correctly stated the law when he declared that the government could properly acquire private land for a stated public purpose and turn it over to a private developer. As early as 1969, in a case Williams v Gov’t of St. Lucia, the Privy Council ruled that “the expression ‘the development of tourism’ does state a purpose which is a public purpose”.
Announcing the arrival of Beaches Sandals, Camillo Gonsalves declared, “legally Sandals doesn’t owe them (workers) any obligations, nor does the state. Legally, their rights still exist against Harlequin, because Harlequin is the one who hasn’t paid them and there’s a process by which the bankruptcy trustee has to pay out debtors and creditors”.
The law of our country does not support this view. The Government and or Sandals are responsible for the money and benefits owed to the workers.
Section 20 of the Protections of Employment Act captioned Sale of business not to affect right of employee says:
(1) The change of ownership by sale or other disposition of a business or any part thereof shall not affect the rights accruing or accrued to an employee at the time of sale or other disposition and the buyer and seller shall be jointly and severally responsible for such rights.
Section 21 captioned “Winding Up” at 21(3) says:
Where an employer’s business is wound up or a receiver has been appointed, an employee or any person legally entitled to claim on his behalf payment to which he is entitled shall have priority over all other creditors including the Crown for the following sums—
(a) wages, overtime pay, commissions and other forms of remuneration relating to work performed during the twenty-six weeks preceding the date of the institution of winding up proceedings or the appointment of a receiver?
(b) holiday pay that is owing as a result of work performed… ?
(d) severance pay, compensation for unfair dismissal and other payments that are owing in respect of the termination of employment.
Yet Camillo Gonsalves, who proudly declared that the government acquired the property and turned it over to Sandals, says it will pay white foreign property owners but have no responsibility to pay Vincentian workers. The law gives priority to our workers; Camillo and his father prefer to pay white foreign investors.
Clause 37 of National Insurance Service Act captioned Offences and penalties states: (1) Any person who fails to pay at or within the time prescribed for the purpose any contribution which he is liable to pay under this act, is guilty of an offence and is liable to a fine of ten thousand dollars.
Ames and his company refused to pay Vincentian workers salary for months. They also refused to turn over to the NIS deducted contributions from workers. The government and its agencies, NIS and the Labour Department refused or failed to protect the workers. Eventually, Ames spirited out of the country and escaped criminal prosecution.
Clause 23 of the regulation that accompanies the National Insurance Service Act captioned “Succession to a Business” states: This regulation applies where there has been a change in the employer from whom an employed person receives wages in respect of his employment in any trade, business, concern or undertaking or in connection with any property, or from whom that person receives any annuity other than a pension.
(2) Where this regulation applies, in relation to any matter arising after a change of employer, the employer after the change shall be liable to do anything which the employer before the change would have been liable to do under these Regulations if the change had not taken place.
(3) The employer after the change shall not be liable for the payment of any contributions which were deductible from wages paid to an employed person before the change, unless such contributions were also deductible from wages paid to the employed persons after the change took place, or of any corresponding employer’s contribution.
What then is the basis for Camillo Gonsalves’ claim that neither Sandals nor Government owes poor Vincentian workers?
Sec 41 of the National Insurance Service Act Captioned Proceedings for benefits lost by employer’s default states:
(1) Where an employer has failed or neglected to pay any contribution which he is liable to pay in respect of or on behalf of any insured person, and by reason of such failure or neglect such person or any other person becomes disentitled to any benefit, or entitled to a benefit on a lower scale, the Director may, on being satisfied that the contribution should have been paid by the employer, pay to the person or the other person benefit at the rate to which he would have been entitled if the failure or neglect had not occurred and the Board shall be entitled to recover from the employer as a civil debt a sum equal to the amount of benefit so paid or the contributions not paid whichever be the greater.
The afore-mentioned clauses in the Protection of Employment Act and the National Insurance Service Act are valid and binding. Our Minister of Finance, a former Minister of Labour, cannot be unaware of these laws. We would hate to believe he intends to pull the wool over the eyes of the exploited and long-suffering former employees of Buccament Bay Resort.
Because the government took over the sole asset (Buccament Bay Resort) which was owned by Ames’ company Harlequin, we are of the view that Camillo Gonsalves improperly and incorrectly stated that neither Sandals nor the state owes the workers any obligations.
Once the Government assumed ownership of what was owned by Harlequin and Ames, the laws clearly say that the company that takes over another company is responsible for the salary, benefits and severance of the previous owner. Why then would Camillo Gonsalves, a former Labour minister, claim that neither the government nor Sandals has an obligation to pay the workers?
On whose side is this “labour” government working, the workers of the country or foreign investors? The labouring masses must look beyond the rhetoric of our labour government for real answers.
*Jomo Sanga Thomas is a lawyer, journalist, social commentator and a former Speaker of the House of Assembly in St. Vincent and the Grenadines.
The opinions presented in this content belong to the author and may not necessarily reflect the perspectives or editorial stance of iWitness News. Opinion pieces can be submitted to [email protected].
Jomo Thomas is either wilfully ignorant of or indifferent to SVG’s bankruptcy laws which are far different from the laws governing the sale of solvent business enterprises.
I am not a lawyer but to the best of my knowledge the Protection of Employment Act and the National Insurance Service Act do not apply to insolvent, bankrupt, or liquidated properties which are governed by an entirely different set of laws.
The simply fact is that Buccament Bay Resort had far more liabilities than it had assets meaning that the market value of the resort was far less than a combination of its outstanding assets and debts, including money owed to former workers and suppliers, persons below other creditors including the secured creditors who actually owned parts of the resort. The government of SVG is said to have paid these secured creditors but there are still monies owed to other parties like suppliers and former employees but there is nothing more to sell to secure these monies!
The only recourse is for additional unpaid creditors like former employees — often called preferred creditors — to action the original owner, Dave Ames — who is himself personally bankrupt — in a court of law. Good luck with that!
Again, the undisputed facts are that the proven and assumed value of properties, debts, and liabilities accumulated by Buccament Bay Resort and its parent Harlequin Resorts — some $US 250 million (see https://home.kpmg/content/dam/kpmg/bb/pdf/2019/10/Harlequin_Property_SVG_Limited_Update_to_Creditors_October_17_2019.pdf ), far exceeded the actual market value of the resort which means that no party, including the government of SVG, would have ever tried to acquire these assets unless they were assured by law that they had no legal responsibility to assume the totality of the previous debts, something they are granted by the bankruptcy laws of SVG.
A hypothetical example illustrates my point. Say you buy a used car from someone who is insolvent and wants to repay a bank loan to restore his credit rating. You buy the car for $EC 10,000. But the former owner still owes $EC 5,000 to some employees he had to lay off but has no other assets to sell. So these unhappy workers go to Jomo Thomas and ask him to try to seize the car from you so they can sell it to pay their lost wages. Jomo would never be successful in doing so based on either the laws he cited or the law of bankruptcy if a formal bankruptcy were initiated.
If this were not the case, no one would ever purchase any distressed assets from a bankrupt person or company if they had to pay all its creditors because this would assure their eventual bankruptcy as well. Bankruptcy laws acknowledge this elementary fact which is why Jomo Thomas’ assertions have no legal grounds.
Surely, Jomo Thomas knows all this.
Vincentian workers for sure are never in the minds of these people. Never ever has been! We can indeed see that by their real actions and just listen to their actual talk. Hypocrisy has always been their hallmark. The cosy up to the socialist in Cuba and Venezuela and just look at the human records of those regimes
These neo-colonialist that we have here in government are unashamed in their disregard of the Vincentian workers whom they exploit to retain their power over the country. What a shame that the reins of power has remained in their despotic hands for so long. Shame on us as a people. Sadly, out of the frying pan and into the fire! From the enclosed plantation to servitude in an open one.
http://abahlali.org/wp-content/uploads/2011/04/Frantz-Fanon-The-Wretched-of-the-Earth-1965.pdf
A warning from the immediate https://www.youtube.com/watch?v=Tf8Unxnq8oY twenty years of neo-colonialism in St Vincent and the Grenadines and the bad behaviour and bad faith on the part of the dictatorship is very plain to see.
What does any of your rhetoric have anything to do with the legal requirement or moral duty of this government to pay the wages to private sector workers it never employed?
What about the unions it seams like they are in bed with the government like the ones in BIM
why would workers already getting paid very low wages continue to pay union dues and getting no representation.
Not only “white” lives matter BLACK ones as well. Thanks my son for continuing to speak on behalf of the d vulnerable, marginalised, “at isk” in this Vincentian society. U have learnt well!
Ralph and Camillo are a bunch of looneys who does not respect Vincentians. How can Ralph and Camillo acting in the capacity of government officials advocate for denying Vincentian workers their hard earn wages which these workers so desperately need to feed their family and children! Are these stooges and comic this delusional? Why do Ralph and Camillo have such hate and disrespect against Vincentians workers, family and children?
Julian Francis: If you have a problem with Buccament… call me!
Everyone owed money including the workers should go to Julian Francis and ask him to pay. He promised if anyone had a problem with Harlequin he would personaly sort it out. He gave many workers and local creditors hope, many believed him, if he had not made those promises many would have given up sooner and ended up being owed less.
https://searchlight.vc/searchlight/news/2012/06/15/julian-francis-if-you-have-a-problem-with-buccament-call-me/
In his May 29 2012 broadcast, Francis said the EC$400 million Buccament Bay Resort development is a child of the ULP administration and must be protected against those who want to bring it down.
He said he maintains one hundred percent support of the project.
At the same time the police black squad were beating back workers from the Harlequin offices, who were there looking for their money. Ralph Gonsalves is in charge of the police, even this branch which many consider the political police.
Then employees drowned when the resort flooded, read this article
https://www.iwnsvg.com/2014/04/26/were-buccament-flood-deaths-murder-by-governmental-neglect/
Please go to the sites above and read what happened
Juliam Francis before each election goes deadly quiet, according to the comrade in the past, told us Julian does all the arranging and organization. I wonder what that actually entails exactly?
Lets try and get this straight either the ULP government owe the Buccamnet employees their wages and or the dynamic duo Julian Francis and Ralph Gonsalves owe it.
Get yourself some placards, go and ask them for your money.
I do not know if Jomo is accurate here. NO, I am not a lawyer, but as we all have seen, it often does not matter what the law says, whoever has the power is usually able to force thier interpretation of the law whether it is correct or not! Sandals did not take-over or buy Harlequin. They have thier own entity that is getting the property not the Harlequin Resort. I cannot believe that the law would set up such a situation whereby that property could sit there for 100 years because there is no way to get it up and running based on such dire conditions. Who is going to oppose the sale/take-over…Jomo? Why would anyone do that?
Well done Jomo, u finally show light on this very important matter,,am sooo happy u did,,and we need more legal minded person like u to help the ignorant and oppressed people of this nation
Jomo you are on the ball. I hope the workers will ask you, beg you and beseech you to represent them. One person question my opinion that Sandals was and is a Ponzi outfit. Well here it is. Sandals don’t want to cover the salaries and other payment to Vincentian workers. Guess who’s on the Sandals side another corrupt, ingenious, abusive and malignant partner.
I believe the government will have to produce the signed deal it has with Sandals if it’s taken to court. I will go as far as to suggest that if Ralph or Camillo cough, take them to court. That’s one way to ensure there is transparency when they use taxpayers’ money for all transactions.
Congrats Jomo! You are ensuring justice is done to Vincentians when dealing with this corrupt, ingenious, abusive and malignant government.
Jomo you are on the ball. I hope the workers will ask you, beg you and beseech you to represent them. One person questioned my opinion that Sandals was and is a Ponzi outfit. Well here it is. Sandals don’t want to cover the salaries and other payment to Vincentian workers. Guess who’s on Sandals side? Another corrupt, ingenious, abusive and malignant partner.
I believe the government will have to produce the signed deal it has with Sandals if it’s taken to court. I will go as far as to suggest that if Ralph or Camillo cough, take them to court. That’s one way to ensure there is transparency when they use taxpayers’ money for all transactions.
Congrats Jomo! You are ensuring justice is done to Vincentians when dealing with this corrupt, ingenious, abusive and malignant government.
I am confused, the property went from private owners to government to another private owner. Now, who should pay, government or the incoming company, is legal of government could be interpreted as company? Bottom line the people need to be paid, if this requires back-pedaling by the minister, he should it. It appears that there is a wrong that needs to be righted.
No, there is no wrong. This is how bankruptcy laws work all around the world. Everyone suffers when small and large businesses go bust. It’s called capitalism, an economic system based on risk, profit and loss, and winners and losers.
Every day, countless people lose their homes because they can’t pay their mortgage. The bank seizes the house and sells it to someone else to recover their loan.
According to your reasoning, the government should just jump in and give a new house to the bankrupt former owner using other peoples’ money? If governments did so, they would soon be bankrupt themselves.
Hi Jomo. Your point is very valid but not all investors in the
failed Harlequin project are white or wealthy. I personally know a humble Indian migrant to Britain who runs a corner newsagent shop there and who invested a significant portion of his lifetimes earnings in Buccament, paid just one visit to his investment and has lost it all. Harlequin hurt a lot of little people, much more so than the rich. So first when the property is sold pay Vincentians what they are owed and if anything is left, pay the small investors their share.
But there will be nothing left.
Gonsalves has already said that the property the government bought will be sold to Sandals for what they paid for it. He also said that the agreement with Sandals leaves that company exempt from any of its other debts.
So this leaves Dave Ames to pay your “humble migrant Indian to Britain” with money he doesn’t have because he is personally bankrupt (https://www.echo-news.co.uk/news/17291340.millionaire-couple-made-bankrupt-amid-390m-property-fraud-probe/).
I am not being cold hearted, just realistic.
At election time in SVG there are always enough scams for us to contend with! But you know waa dem say “fool me once, shame on you; fool me twice, shame on me!” Ah nah so!
See de sales pitch from a “wide boy” from Essex, England as he tried to winkle money out of the poor unsuspected. https://www.youtube.com/watch?v=R7DOkipbqqs a real spiv! Be they workers or investors none were ever safe when several spivs are working together.
Sick or otherwise dem nah carre! Carze wah, ah fool dem warr fool yo!
https://www.youtube.com/watch?v=cDZdfSGxuIA
At last somebody to standup for those workers I was wondering when would somebody
Come forward it seams like SVG is full of spineless cowards so afraid of the ruling regime
To getup and speak they mind kudos to you Mr Thomas keep up the good work.
The best article I have read in a while… what a government
Section 20 sub-section 1 of the protection of employment act speaks to the sale or OTHER DISPOSITION of a business. So it follows in my opinion that a business will go into bankruptcy if it becomes insolvent and will be liquidated as a consequence. So naturally, liquidation is a consequence of bankruptcy/insolvency which is just another format of bringing to an end the operation of a business. So if a business ceases to trade because of insolvency it still falls within the ambit of the meaning of section 20 sub-section 1.
Therefore, according to section 21 of the said act, payments to employees takes priory over any other debt that the company may have on its books. So in other words, if the government compulsorily acquired the defunct property and subsequently sold it to a developer (which is the right thing to do) then the employees who are owed has the first right to the proceeds from the sale of the property. In lay-man terms, the workers must get pay first before anything or anybody else, even before they take out the taxes that are owed to the government.
Wow this puts a spin on things now the workers need a neutral lawyer
one without political ties to the comrade or son.
Its called pissing in the wind. Because C ben David is correct and Jomo Thomas is wrong. There is no money left, but it will be intetersting to see if VINLEC, CWSA, Inland Revenue, VAT, get paid and the workers do not. But even if they do the workers will get nothing because they are legaly due nothing from this deal as structured.
So, folks. remember well this all came about because Dave Ames was allowed to do what he did, the government were warned for a number of years before it all went bust. Ames was a crook when they sold him the land, they were warned but continued embracing him, making him and his family citizens and giving them passports. There was a saying at that time ASK RALPH, so I suggest what you do is ask Ralph.
You workers all voted for him, so the problem rests with you, Ask Ralph and Julian.
If you do not get paid do not vote for them this year.
The Trustee in the Bankruptcy is using the legal argument that the company that he represents is separate from all other Harlequin companies. The employees of the resort were hired and working for Harlequin Hotels and Resorts. The land is registered under the name of Harlequin Property SVG Limited, This is the company that would sell it’s interest to the government. Only those creditors that have a claim that the Trustee would recognize against this company would get paid. The Trustee has been able to separate the liability of all other Harlequin companies away from the land. This would also separate the taxes owed to the government away from the land transfer. The taxes and wages would be owed by Harlequin Hotels and Resorts which the Trustee has already wound up. I would argue that the Harlequin group of companies were not separate companies since Dave Ames was the owner and director of all of the companies and Dave authorized all payments from one bank account.