Published On: Fri, Jan 22nd, 2021

Sales clerk loses court case over salary-reduction

PHILIPSBURG- – A 22-year sales clerk of a local cheese shop lost her job due an argument with her now former employer over a 50 percent salary reduction. The Court in First Instance admittedly awarded the employee half of her salary over the one month term of notice, but it rejected a claim for damages that exceeded 25,000 guilders.

A remarkable statement in the court ruling seems to indicate that the government encourages employers to fiddle with their administration when they apply for salary-subsidies. “That incorrect pay slips have been made is according to the employer due to the government’s demand to qualify for salary-subsidy,” the ruling states. The court ruled that while the employer had indeed done this that this did not amount to fraud.

The employee worked at the cheese shop for a gross monthly salary of 2,451.30 guilders. In March of last year, faced with the economic downturn caused by the corona-pandemic, the employer proposed to cut working hours and salaries by 50 percent. All employees agreed.

In a Whatsapp-exchange about the pay slips with the employee the employer wrote: “Pay slips were put on 100 percent in order to get SSRP (Sint Maarten Stimulus and Relief Plan) and seeing we are not getting any help from the government we will correct the upcoming pay slips so that no one is paying too much taxes.”

The employee got miffed when she discovered that her employer had received a salary subsidy over the month of May (60 percent of cost) but that her salary had remained at 50 percent. She filed a complaint through her attorney. The employer reacted by firing the employee retroactively on September 15 per April 1, 2020. The company paid out unused vacation days, salary over the term of notice and severance pay for a total amount of $2,875.

The employee contested her dismissal in court, demanding 25,000 guilders in damages and another amount of close to 5,000 guilders for unreasonable dismissal.

The court ruled that the law does not allow retroactive dismissals and though the ruling notes that therefore the labor contract remained in place, it also states that the employee apparently agreed with her dismissal. The court was however reticent about the claim for damages, considering the dependency of St. Maarten’s economy on tourism and the economic hardship caused to the employer by the corona pandemic. The court found no grounds for awarding damages to the former sales clerk.

The court ruled that the employer had made a reasonable proposal for the reduction of working hours and salaries because this still gave employees the perspective of returning to a full-time job once conditions improved. But because the court ruled that the dismissal of the employee was “irregular” it ordered the employer to pay out 50 percent of the salary over the one month term of notice, an amount of 1,226 guilders.