The closed Little Switzerland store in Front Street.
PHILIPSBURG--Twenty-three employees of high-end jewellery story Little Switzerland and their union Windward Islands Federation of Labour (WIFOL) have won an injunction in the Court of First Instance against their employer to obtain their due salaries.
In these summary proceedings the workers claimed their due wages from July 1, 2020, up to and including September 30, 2020, with a 50 per cent increase and statutory interest. The judge was also requested to order Little Switzerland to pay the legal fees of these proceedings, in which the employees were represented by lawyer Jelmer Snow of the BZSE law office.
In the verdict, which was presented on Friday, the court ruled that the workers’ claims could be permitted. However, the legal increases were moderated to 10 per cent. As the unsuccessful party, the employer was ordered to pay the legal costs.
Little Switzerland’s holding company, World Gifts Imports (WGI) BV, had pleaded to reject the workers’ claims, based on the company’s severe financial losses. WGI was to substantiate its financial position during a closed door hearing held November 10, 2020, as the company did not want to share sensitive information in public, WGI’s lawyer Daniëlla Engelhardt of the VanEps Kunneman Van Doorne law firm said during the injunction hearing of November 6, 2020.
According to its website, Little Switzerland is the largest authorised retailer of designer jewellery and luxury watch brands in the Caribbean. Recently, the company closed its three stores in St. Maarten and is busy terminating the rental agreements.
Engelhardt said during the court hearing that WGI will discontinue its Little Switzerland operations in St. Maarten. All labour agreements will be terminated, preferably by mutual consent, otherwise by means of termination proceedings before the court.
The 23 employers asked the Court to order their employer to pay their arrears in salaries consisting of the difference between their base wages and their average remunerations, including bonuses and premiums, from July 1, 2020 to September 30, 2020.
As a main rule, the employer is obliged to continue to pay the full wages, the judge stated in the verdict. Also, the employment contracts do not show that, because there was no more turnover due to the COVID-19 pandemic, the employees were not entitled to more than the basic wages.
The text of the employment contract only states that the employee has a fixed low base wage, but can supplement this by realising good sales. That they have been successful in making good sales is demonstrated by the difference between their basic wages and their full wages, according to the judge.
The judge stated that considering the “enormous consequences” of the COVID-19 pandemic for company turnover, the employer was entitled to make a “reasonable proposal” to the workers to agree with a salary reduction. However, no such proposal was ever made, as the agreement closed by mid-2020 was described by WGI as “one of the requirements for the application of the wage subsidy.”
The court said that the COVID-pandemic would “certainly” have justified a change to the “variable primary labour conditions,” but even in that case the proposal would not have been reasonable, as WGI had “unilaterally” laid the burden of the pandemic on its employees by means of a 75-per-cent wage reduction, while it did receive wage subsidy in the preceding quarter.
WGI had also failed to provide insight as to its financial situation. Figures about the accumulated reserves, the company stock, the wage subsidy, statements by an external accountant and figures pertaining to turnover- and profit-tax returns were missing. This all led the court to the conclusion that WGI had failed to pay the workers their due salaries, whereas the company was obligated to do so.
