Congressman Faleomavaega announced today that he has written to the Honorable George Miller, Chairman of the House Committee on Education and the Workforce, requesting a postponement of further minimum wage increases. Faleomavaega copied his letter of January 28, 2009 to the Governor, Lieutenant Governor, the President of the Senate and Senators, and the Speaker of the House, and Representatives. A full text of Faleomavaega’s letter is included below.
Dear Mr. Chairman:
I am writing to request your assistance in ending minimum wage escalator clauses for American Samoa which were enacted in P.L. 110-28. Since P.L. 110-28 was enacted, minimum wage has been increased in American Samoa and the Commonwealth of the Northern Mariana Islands (CNMI) by $1.00 per hour. While I am appreciative and was supportive of this increase for our workers, I believe it is necessary, given the global financial crisis we are now facing, for Congress to provide temporary relief for our local businesses operating in American Samoa which are unable to incur further increases in minimum wage at this time.
Like you, I regret that the Department of Labor (DOL) report commissioned by Congress fails to provide the Committee on Education and the Workforce with the compelling evidence it needs to roll-back escalator clauses. However, the current state of the economy in the U.S. and its Territories requires me to request your direct intervention. Clearly, I support Congress directing the DOL to undertake a new and more thorough study that will be useful to the economies of American Samoa and CNMI in the future. In the interim, I am hopeful that you will support my request to end escalator clauses.
The local chamber of commerce in American Samoa intends to provide my office with specific information outlining its concerns and needs which I will submit to you upon receipt. The American Samoa Legislature may do the same. Until this information is available, I would like to provide you with other data that is of critical importance.
American Samoa’s private sector economy is more than 80% dependent, either directly or indirectly, on the tuna fishing and processing industries. Two canneries, StarKist and Chicken of the Sea, employ about 5,000 cannery workers. The starting minimum wage for a cannery worker in American Samoa is now at $4.26 per hour. Cannery workers in competitive markets are paid $0.70 cents and less per hour. While it is unconscionable that any American, or foreign, corporation would pay overseas workers wages of $0.70 cents and less per hour, this is reality, and American Samoa is caught in the crossfire, trying to survive in the global marketplace while maintaining fairer wages for its workers. This has been no easy task.
In November of 2008, Del Monte finalized its sale of StarKist Samoa to Dongwon, a South Korean conglomerate. On November 17, 2008, StarKist announced that as a result of increased minimum wages and effective January 1, 2009, it would eliminate twenty full-time salaried positions; hourly employee pension benefits; seven paid holidays; paid vacation for hourly employees; and additional activities that benefit hourly workers currently employed at StarKist Samoa. At this time, it is unclear what action Chicken of the Sea might also take in order to address rising wage and energy costs.
While I have taken issue with StarKist for attempting to use minimum wage as an excuse for cutting workers’ benefits when the real source of its problem is corporate mismanagement and greed, I am still working to do my part to help both canneries and local businesses operating in the Territory. Since workers in American Samoa have finally received a long overdue increase of $1.00 per hour in minimum wage since enactment of P.L. 110-28, I am hopeful that you will be able to place a temporary hold on escalator clauses until such time as economic conditions warrant future increases.