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Counterpart policy will fail in its current form

Dear Editor,

In a letter to the Editor in January 2015, I gave an opinion about the Counterpart policy. Afterward, the Minister of Public Health, Social Affairs and Labor published a Counterpart Guideline in the National Gazette on April 2, 2015. This Guideline is a direct result of a court case that the Minister had lost (LAR 117/ 2013).

In that judgment, the Court of First Instance set certain parameters for future counterpart cases. First, the Court expressed that it had doubts as to whether the counterpart policy (as a whole) has a legal basis. Second, it was unclear to the Court whether the employer has to recruit a counterpart or that the Labor Office recruits and appoints the counterpart.

Third, the Court "advised" the Minister to use an objective guideline, which was not in place at the time of the case LAR 117/2013.

Fourth, the Court instructed the Minister to explain how the counterpart policy is not in violation with International Treaties. Lastly, the Court instructed the Minister to explain why imposing the counterpart condition is more important than the interests of the employer, who is confronted with extra costs (double wages) and efforts (education).

With the publishing of the Counterpart Guideline, the Minister made a poor attempt to address only two of the issues the Court has raised (the second and third issue mentioned above). The other three issues are not addressed in the Guideline, and this will make it difficult, if not impossible, for the Minister to successfully impose the counterpart criterion to a work permit.

The Guideline is a five-page document and does not give any new viewpoints on how the Counterpart policy should be executed in practice; nor does it describe any procedures. Rather, it shows that the Minister and his policymakers need a reality check. For instance, the Minister truly believes that a counterpart can be trained in a highly specialized managerial job within three years. Furthermore, in the Guideline, the Minister continues to place the burden of educating and training the counterpart – and the costs thereof – completely with the employer.

Based on the Guideline, the counterpart would have to be employed based on an employment agreement, with a salary close to what the foreign employee is making. After three years, the foreign employee will have to leave Sint Maarten (because the employer will no longer be able to get a work permit for him/her) and the counterpart will have to be offered an employment agreement for an indefinite period of time. To add insult to injury, based on the Guideline, it appears that the Labor Office has the lead in evaluating the counterpart, and not the employer.

The only good thing about the Guideline is that the Counterpart policy will first be implemented as a pilot. Hopefully, during this pilot, the Minister will come to realize that this policy is not only destined to fail, at least in its current statutory form, but also has the potential to cause serious damage to the local economy and scare away foreign investment.

Camiel Koster,

Attorney-at-law

BZSE Attorneys at Law | Tax Lawyers

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