Senators sent the controversial Employment Amendment Act packing back to the House of Assembly yesterday, citing concerns about the overtime clause harming Bermuda's workers far more than it would help.

Independent senators joined with the Opposition in voting against the overtime clause, and Government amended the bill in the Senate to remove that clause. The original amendment included 14 clauses, all of which had been agreed to - except the overtime clause.

Now the amended bill will be sent back to the House of Assembly, where the Labour Minister must wait one year before he can make any moves on the bill.

At that time he may either attempt to pass the amended bill, or amend it again to include the overtime clause once more and attempt once more to pass it.

The clause would have made it mandatory for employers to pay all non-professional employees time-and-a-half for overtime had it passed through the Senate.

It passed through the House of Assembly last Friday after Shadow Labour Minister Maxwell Burgess admitted the Opposition was powerless to stop it, as Government had the House majority. Government argued the amendment would have brought Bermuda in line with the International Labour Organisation (ILO) guidelines and would benefit Bermudian workers as well as help prevent the exploitation of guest workers.

Government Sen. Reginald Burrows said certain industries, religious and charitable organisations, and small businesses would be able to apply for exemptions from the new law.

The length of the working week could also be negotiated for certain employers/employees, he added. Though the move would cost Bermudian businesses, Government felt the cost could be absorbed.

Independent and Opposition senators did not buy it, however.

The Employment Amendment Act would have made regular pay wages plus half wages mandatory for overtime and abolish the clause allowing an employer and employee to agree to opt out. This clause of the act applies to people in non-professional positions. However if a better package already exists for the employee, that will override the Act while individual industries can opt out with the agreement of Government.

Kicking off debate Government Sen. Reginald Burrows said certain industries, small businesses, and charitable and religious organisations can all apply for exemptions from legislation making the payment of overtime mandatory.

The cut-off point for overtime to start could also be modified for certain employers or employees, he said, depending on the health and safety of the worker. The generally-accepted 40-hour work week may not necessarily apply to all industries.

Sen. Burrows said the legislation - forcing employers to give all non-professional employees time-and-a-half for any overtime - will bring Bermuda in line with International Labour Organisation (ILO) standards.

The legislation exempts overtime pay to managers and professionals whose salaries already reflect the anticipation of overtime, he said.

Though the Bermuda Industrial Union (BIU), which supports the amendment, stands firmly against any exemptions, Sen. Burrows said Government is following ILO guidelines.

The Bermuda Trade Union Congress (BTUC) is against the amendment, he said, claiming it will lessen the collective bargaining power of unions - an assertion Sen. Burrows said was untrue. Government has a mandate to protect all workers, not just unionised workers, he added.

The move will be cost Bermuda's employers, he added, however he was confident they would be able to handle it.

As for concerns that employers will find it more cost-effective to hire more workers to work at straight time rather than pay overtime, Sen. Burrows said "wise employers" who are concerned about staff loyalty will be wary of that move.

There is also a number to the limit of people who can be hired to avoid paying overtime, he said. "Unfortunately, the Minister's policy cannot satisfy everybody."

Sen. Hughes said making the time-and-a-half pay mandatory did not apply to Bermuda's economic climate since the Island had a heated economy where there were too many jobs and not enough people to fill them.

He pointed out that a number of people hold jobs on the side which also provide some "extraordinary opportunities to earn money".

Sen. Hughes said if time and a half pay for overtime work becomes mandatory the price of goods and services would rise substantially.

He said the total effect of the legislation on international business was not explored. The effect of an increase in costs of good and services was evident in the tourism industry, however, since he pointed out that people had a natural tendency to go where they could get the most for their dollar.

"People can go other places for less - we must not let that happen. International business is a dominant feature of Bermuda, we must not become complacent," said Sen. Hughes.

"Big companies watch their pennies, even if they can afford it - that's how they became big in the first place."

He continued: "Economically, I don't think this has been thought through carefully, it would hurt rather than help. There are other ways of achieving this goal such as a longer working week used in other countries."

Sen. Hughes said the strong case for employees rights was made by Labour and Home Affairs Minister Randy Horton, however, he said if the amendment was put into effect companies would find ways to scale back the hours of their employees.

Sen. Hughes also pointed out that six or seven industries had already applied for exemption mainly construction and restaurant businesses, which could turn out to be a long process for these companies and for Government.

He also pointed out that there was no provision in the legislation for mediation.

A close look at the bill also revealed that there is no time clause as to when the proposed time and a half pay would come into effect, which is a major oversight according to Sen. Hughes since it could lead to employers paying their employees the wrong rate and thus breaking the law without intending to.

Sen. Bassett said the spirit of the bill was well intended, however, she pointed out that legislation would not correct the behaviour of unscrupulous employers who mistreated their employees.

She said employees needed to be educated about their existing rights through present legislation. Overall, Sen. Bassett said overtime pay could have the effect of putting a strain on the economy, adding to possible outsourcing to other jurisdictions, and a strain on existing housing and traffic.

She said the choice to work overtime rested in the hands of the employees who had to recognise they had choices as outlined in the existing legislation.

Hiring additional staff could put pressure on the local workforce to compete with guest workers, adding to the strain on families, pointed out Sen. Bassett. It may also be cheaper for companies to hire additional staff to curtail overtime hours employees could work.

"I am also concerned about the effect this can have on small businesses who are the backbone of our economy. Their profit margin is small and with this legislation they could be put at an increased risk of going out of business. They are also an integral part of tourism since they provide many of the services the tourism industry relies on."

UBP Senator Bob Richards said he did not support the bill as it was not logical for Bermuda, a nation which is now competing with other off-shore business jurisdictions, to put themselves at an increased risk for competition.

He said the legislation, modelled after existing legislation in Prince Edward Island did not make sense since this was a province of Canada with an economy that does not resemble Bermuda due to its reliance on natural resources, high unemployment rate, seasonal work.

Sen. Richards said the competing jurisdictions to the south of the Island could use this to their own advantage.

In Barbados he said the two labour parties who are in political power were not supportive of mandatory overtime and had left the issue to be agreed upon by employees and their employer.

Sen. Richards also said employers will cut back on bonuses, and on existing overtime as agreed upon by employers if time and a half pay was put into effect.

According to Sen. Richards the specifics of who will be exempt from the act was not addressed in specifics and the legislation lacked clarity as to who is eligible for exemption.

Overall, Sen. Richards said the law could have an adverse effect on the people which Government has promised to help.

"The law could have the most acute effect on small businesses - the very sector Government has promised to assist. The UBP supports economic empowerment and encourages the growth of small businesses. This legislation is the anti-thesis of this principle and commitment."

Attorney General Larry Mussenden said the bill was designed to protect people who were "grass roots" employees - the people who worked as dishwashers and gardeners who did not get bonuses or similar job perks.

"How is it that we can have people working 50-70 hour weeks and never introduce them to the subject of overtime," questioned Sen. Mussenden, pointing out that this situation does exist for many workers.

Sen. Mussenden also pointed out that while costs of doing business had risen the average pay cheque of a construction worker had not risen substantially. The bill was also designed to protect guest workers who worked straight time beyond the required 40 hour week and did not receive time and a half.

The opportunity an employer had to pay a guest worker for this work, rather than a Bermudian also had a detrimental effect on the numbers of Bermudians who could hold these positions, and led to exploitation of the guest worker, said Sen. Mussenden.

"We can not deny people the opportunity to have overtime beyond the 40 hour week," said Sen. Mussenden.

PLP Senator Neville Tyrell said he was supportive of the bill as it enforced fair employment practices. "It's a good bill in its entirety especially for non-unionised persons who don't have representation," he said.

"However, expatriate workers who may want to long hours puts pressure on Bermudian workers meaning that is more time they spend away from their families," he said.

UBP Senator Kenny Bascome said the numbers of employees who think they are treated fairly by their employer outweighs those who feel shafted.

"I was approached by a small construction company owner who said he would be adversely affected by the bill if it was passed today. As a result the bill could have many effects causing people to scale back on their staff."

Government Senator Walter Roban said that if we are going to give value to trades people, we should also show them they will have protection for overtime.

He added that of the legislation only one provision was rejected - mandatory overtime.

Mr. Roban pointed out that currently a lot of non-Bermudian workers are being abused by not having mandatory overtime on the books. "Some people do not know what is good for them until it comes along," said Mr. Roban.

Of the mandatory overtime Mr. Roban said that Government received international advice on it. "This legislation will help Bermudian workers," he said.

Government Senator Raymond Tannock said: "We are a labour Government and have to consider the well being of our citizens."

Opposition Senator Kim Swan said: "The key ingredient in business is choice."

And of paying employees Mr. Swan said: "The majority of businesses are getting it right."

President of the Senate Alf Oughton said that what really needs to be done is better policing of the original Employment Act. "The ministry could spend more time policing small companies that exploit their employees," he said.

He added that the minimum standards of the original Employment Act was a big step forward and Government should not impose itself on improving that. He said there should be freedom of association between employers and employees.

Government Senator Reginald Burrows pointed out that if Bermudians do not work the overtime the foreigners will and sometimes Bermudians end up losing their jobs.