PL 15-108 Is Progress. Progress Is Incremental

Below is Senator Frica Pangelinan's Opinion piece on PL 15-108 which was published by the Saipan Tribune. Click here.

Opinion
Tuesday, January 22, 2008

Notes From the Hill

'PL 15-108 is progress. Progress is incremental.'


By Maria Frica T. Pangelinan
Special to the Saipan Tribune

These are the thoughts that evolved out of my research on Public Law 15-108 and ultimately motivated my support of its enactment. I felt it important to share with you as I believe that information is an essential component of constructive progress.

The dynamics of our labor market affect many, not just people in the Commonwealth. The families of citizens, permanent residents and foreign nationals who live on the U.S. mainland and in home countries are influenced as well.

The original labor laws were created on the premise that certain foreign nationals would fill jobs that could not be filled by our resident population. There were two reasons. First, we felt that our small population would not be able to provide a large enough labor pool to fully supply the needs of the industries we were trying to attract. Second, we needed time to prepare ourselves with education, training, and experience, for full participation in the workforce. After 30-plus years, we are more than ready. Even so, we have been slow to acknowledge and address the “brain drain” of citizens leaving our islands. Our investment in the secondary and postsecondary education of ourselves and our young people is being lost as they migrate out of the Commonwealth. Some of our college graduates never even return from the mainland, simply entering the workforce there. We are about a half a generation behind in coordinating the provisions of our labor laws with these realities.

The authors of the bill took on a huge task. Not only were the old laws and regulations complex, they were flawed and fragmented. The original purpose of the Nonresident Worker Act had been lost in a morass of piecemeal amendments. There were loopholes and weaknesses that allowed abuses, not just by employers, but by employees as well. It was a thankless job, not likely to please everyone, and fraught with political and social risk. Nonetheless, led by Rep. Cinta Kiapat, they took on the task of reforming the entire Act, something that no legislators before had been willing to tackle. For this, they have my respect. They did their jobs.

The new law and the accompanying regulations are still complex. Laws that deal with the movement and employment of people across international borders deal with complex issues. That being said, the new law is more streamlined and organized than the old.

PL 15-108 does not address every issue I would have liked. The exit provision makes no allowance for foreign nationals who have lived and worked in the Commonwealth for many years, some with children who are U.S. citizens. Some have no home or family to return to in their home countries during the newly required exit period. Although the regulations provide an alternative exit period of 60 days for some foreign nationals employed by qualifying employers, I do not yet see a clear solution for this issue and it needs to be addressed.

I would also like to revisit the new medical insurance provision. CHC struggles under the burden of being owed millions of dollars for services rendered. This is not a problem created solely by non-payment of medical services for foreign nationals. There are others in the Commonwealth who do not have medical insurance. I would like to explore the possibility of expanding the role of the newly created insurance pool. Perhaps by eliminating self-insurance we could build a larger insurance pool, insuring CHC gets paid more often, an additional benefit for the entire Commonwealth. I am continuing to study this issue.

There is also the issue of foreign nationals who enter the Commonwealth under tourist visas and intend to work. Some of them know they are breaking the law, some do not. The screening procedure used by our Immigration officers at the point of entry should take this into account. At this point I do not know if the current procedures effectively identify these persons, or how the situation is handled. I plan to explore this with the Director of Immigration.

Over the years there has been an accumulation of claims, and court cases pointing to loopholes and weaknesses of the old law. Most people, businesses, and government employees, are honest, hardworking, and law abiding. However, some employers and employees have taken advantage of loopholes, or chosen to break or circumvent the law. Next are the hard lessons we have learned while administering the local labor and immigration laws. People have been taken advantage of and lives have fallen through the cracks. There were as many as 20,000 foreign nationals employed in the Commonwealth in 2007 and the number of tourists was almost 400,000. Only a small number of human trafficking cases occurred during that period. The fact remains, however, that each case is a tragedy for the victim and their families. Every loophole we close is progress toward ending this horrendous practice.

The authors of PL15-108 took these issues and more, into account, integrating input from the Attorney General's Office, the Department of Labor, the business community, private citizens, and many others.

Below is an overview of labor and related issues in the Commonwealth.

Labor Problem

1. A government with too many employees

2. Government revenues are shrinking

3. Average wages are higher in the public sector

4. Relatively high unemployment among residents

5. Highly skilled and educated citizens living on the mainland

6. Residents have problems finding private sector jobs

7. Poor working and living conditions of some foreign nationals

8. Human trafficking

9. Lack of health benefits for foreign nationals who are not workers

10. Abandoned and unpaid foreign nationals

11. CHC has difficulty getting paid for services provided

Solutions

1. Reduce the number of public employees

2. Reduce expenses (payroll), raise revenues

3. Equalize wages in the private and public sector

4. Increase local employment in the private sector

5. Increase employment opportunities in the private sector

6. Improve the system of identifying and matching qualified residents with private sector employment opportunities

7. Improve the inspection and enforcement power of DOL

8. Close loopholes in the foreign national labor laws

9. Mandatory health benefits

10. Improved bonding/increased enforcement by DOL

11. Mandatory medical insurance; disqualifying employers who do not pay medical bills for their foreign workers


PL 15-108 creates rewards for employers that exceed statutory standards and increases the severity of penalties for those, including government employees, who do not uphold the law. The new law is said by some to increase the administrative burden on local businesses. Yes, it does. Hiring a new foreign national is now a special and final option for an employer, and only when it is a documented certainty that no citizen, permanent resident, or foreign national already in the Commonwealth is willing and able to fill the position. This is the same premise on which the Federal guest worker programs are based; to augment the resident workforce, not displace it.

Our entire labor market is shrinking. Payroll is usually the largest expense of a business. The private sector has always adjusted to the economy, increasing and decreasing the number of employees based on demand.

Now, whether by design or by necessity, public sector employment is decreasing also. Payroll is the largest expense of the government as well. Reducing the number of employees while controlling the wages of those who remain must be part of the government's path to solvency. Some who leave the government will retire, some will go off island for employment, and some will depend on social services and family for a means of support. However, many will be searching for private sector employment. We must now work even harder to connect our resident work force with the available jobs.

Part of the solution is to improve the process by which we identify and target career opportunities in the private sector for citizens and residents of the CNMI. The faulty stereotype of all private sector jobs offering only minimum wage is challenged by a study recently completed by the Office of the Public Auditor. During a twelve month period ending August 2006, over 800 nonresident permits were issued for positions that pay over $10 per hour. Many of these positions require the same skills and experience as public sector jobs. It has been reported that some of these positions are protected by a treaty provision and are not available to citizens and permanent residents. I will work with the OPA to verify these reports.

The report is available at: http://www.opacnmi.com/reports/053007%20Jobs%20Study%20Committee%20Final%20Report.pdf

High unemployment among our residents as well as losing them to mainland life is unreasonable in light of the findings of the OPA's job study. Actively recruiting qualified residents for positions should be a priority for private sector businesses.

Employers certainly recognize that by hiring citizens and permanent residents, they are keeping money circulating in the economy that would otherwise be lost to foreign countries in the form of remittances. Keeping these dollars in the Commonwealth takes advantage of the multiplier effect in our economy and this benefits everyone.

Change always causes angst and uncertainty. Some say that PL 15-108 is pointless, as it is soon to be overridden by federal immigration statutes. I respectfully disagree. We have identified problems with our labor laws. We legislators have a duty to correct them. "If “federalization” comes, in its current form, it will not become effective for a year after the bill is signed into law. At a minimum, we have a year during which we continue to be directly accountable for how we deal with identified problems. As our great American hero, the Reverend Dr. Martin Luther King Jr. once said: "The time is always right to do the right thing”.

Does PL 15-108 solve all of our labor problems? No. There are larger economic factors, some global, that no law can fix. Our labor market is smaller than in the past and there will be fewer foreign nationals in the Commonwealth, but those that are will enjoy an improved quality of life because of PL 15-108.

PL 15-108 is progress. Progress is incremental. I will continue to monitor the implementation, and work to address the issues I have identified, as well as others that may arise.

(Maria Frica Pangelinan is a senator in the 16th Legislature.)