Published On: Tue, Nov 2nd, 2021

Court declares cost-cutting ordinances constitutional

PHILIPSBURG – After careful consideration the Constitutional Court has rejected the Ombudsman’s request to void three temporary national ordinances that regulate cuts in the labor conditions for civil servants, politicians and employees in the (semi) public sector. This means that the salary-cuts, that were ratified in March of this year with retroactive effect until July 1, 2020, now have a definite legal basis. It is not possible to appeal Constitutional Court-rulings.

The Ombudsman petitioned the Constitutional Court on April 26, 2021 and the government submitted its rebuttal on June 22. The court handled the case in a public hearing on August 20.

The contested ordinances regulate a 12.5 percent cut in the labor conditions for civil servants and employees in the (semi) public sector, a 25 percent cut in these conditions for ministers and members of parliament, and a maximum to the top salaries in the (semi) public sector to 130 percent of the prime minister’s (lowered) salary.

The Ombudsman contested the ordinances based on article 15 of the constitution (protection of property), article 16 (equality-principle), article 19 (livelihood) and article 61.3 (voting without burden) and article 44 (the parliament represents the whole of the population).

The court notes in its ruling that it needs to exercise restraint when it comes to rendering judgment on democratically established ordinances.

The Ombudsman argued that the measures are not in the general interest, that they are arbitrary and that they have been established without proper preparation. The measures are disproportionate for lower-paid civil servants, the ombudsman pointed out, adding that the government cannot treat its citizens in such a way that they fall below the poverty line.

The court ruled that the ordinances are a sufficient legal basis for the measures they contain and that the importance of continued liquidity support is sufficient reason to implement them retroactively. The court also considered that the salary cuts are part of a larger effort to get a grip on the country’s disastrous financial situation: the establishment of the COHO (Caribbean Organization for Reform and Development), and the agreements made about the country package and the execution agenda.

“There is a strong link between the cuts and the reform program,” the ruling states.

The government provided the court with basic information about salaries and social benefits. It appears that there is just one civil servant in scale 1 (the lowest salary scale) in step 10. This person earns 1,844 guilders ($1,030) per month. All in all the government employs 51 employees in scale 1, between steps 10 and 20.

The minimum wage in the meantime is, for a 5-day workweek, 1,532 guilders ($855.87) and for a 6-day workweek 1,838 guilders ($1,026.82).

In August the government paid 581,918 guilders ($325,094) in onderstand (social benefits) to 992 different citizens, an average of 585.70 guilders ($327.21).

Someone living alone receives 734 guilders ($410) onderstand, a family with two children gets 1,067 ($596) and a family with three children 1,734 guilders ($968.72) per month.

The court stated that St. Maarten had not defined a poverty line. It furthermore found that there are no unemployment benefits for the private sector (only cessantia), that civil servants have a redundancy-regulation that pays, depending on the duration of their employment, from 2 to 24 months. Pay decreases over time from 95 to 70 percent.

The court also observed that the government does not have “specifically measured” unemployment data. It relies on SZV, where in March 2020, 20,432 employees were registered and in August 2021 16,034. For the period of September through December of this year there are 15,854 employees in the SVZ-registry.

These data show that the private sector was hit pretty hard by the COVID-19 pandemic. On the other hand, the government told the court that not a single employee in the (semi) public sector has lost its job during the same period.

The court ruling states that the lowest paid civil servant is making 300 guilders more than the minimum wage and that the minimum wage is above the poverty line, while onderstand is significantly below the minimum wage.

The court furthermore established that ministers in St. Maarten are well paid: $11,315 per month, versus $8,365 in Aruba and $7,839 in Curacao. The monthly salary of a Dutch minister is €12,332 ($14,305 at the current rate of exchange). Parliamentarians in St. Maarten get $10,801 per month; their colleagues in Aruba earn $6,069 and those in Curacao $7,111. Dutch parliamentarians get €8,431 ($9,798).

Against this background, the court ruled that the cost cutting measures are not disproportionate. These measures do not take away property (like a salary), the court ruled, but they only limit the right to property. The financial-economic crisis of extraordinary proportions justifies the measures as they serve a significant general interest: the continued liquidity support from the Netherlands.

The Ombudsman also stated in its petition that the ordinances violate the equality principle, because employees of the cabinet of the governor, the public prosecutor’s office, the Common Court of Justice and the Coast Guard are exempted from the cuts. These employees cannot be compared to the civil servants St. Maarten employs, the court ruled, because their position is regulated by kingdom law and they are for the most part paid by the Netherlands.


Read the 30-page decision here>>>