The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Grand Lucayan’s Board plans to begin voluntary staff separation payouts without an agreement with the workforce’s trade unions on their value and terms, its chairman said yesterday.

Michael Scott, who heads the Government-owned special purpose vehicle (SPV) that controls the resort, told Tribune Business that despite “bending over backwards” in negotiations, and attempting to be “as generous as we could”, the board could not meet the unions’ demands given their limited taxpayer-financed budget.

Confirming that the payments to staff wishing to exit will be made before year-end, Mr Scott also confirmed that the board had retreated to its previous fall-back position of a “take it or leave it” approach. Cheques will be made available, and all those declining to accept them will be deemed as having decided to stay and be required to report to work as normal.

The Grand Lucayan chairman said the board’s decision now needed to be approved by the Minnis Cabinet, as he revealed that his fellow directors “will not let me advance a dollar more” on what they considered “a fair and reasonable offer” to both unions.

“The Board has reached a determination,” Mr Scott told Tribune Business. “It’s in the hands of the policymakers now. The Board has communicated its final position. Our position is that we have bent over backwards and strained to be as fair as generous as we could, but we have a limited budget and are expected to ensure we conserve it as best we can.

“I have told the representatives of the line and managerial staff that we have gone as far as we could with them. We are preparing to implement what we have offered: If you like it [the payout], take it, and if not show up for work.

“We are going to get this done by the end of the year. There is no more money. I made them an offer I consider fair and reasonable. It’s been blessed by the Board, and they will not let me advance a dollar more. Someone has got to take a stand.”

The impasse with the Bahamas Hotel Managerial Association (BHMA), which represents middle management workers, and the Commonwealth Union of Hotel Services and Allied Workers (CUHSAW) that acts for the line staff, comes exactly one week after Mr Scott confirmed that their differences over the voluntary separation packages with the Board had narrowed “substantially”.

He had been “aiming” to finalise the packages for the 227 staff who had indicated they wished to leave - 90 managerial and 137 line workers - by the end of last week, while confirming that Board and unions were “very close” to an agreement on payout valuations and terms.

Mr Scott declined to detail what has seemingly derailed the talks, although Tribune Business understands that the Grand Lucayan’s Board was closer to a deal with the BHMA and its lead negotiator, Trades Union Congress (TUC) president Obie Ferguson, than the line staff union.

Mr Ferguson could not be contacted before press time, and Mr Scott also declined to provide figures showing how far apart the sides were. This newspaper, though, was told that the Grand Lucayan increased its original $2.7m total offer to the BHMA, but the union raised its demands in the final days of last week.

The gulf between the Government-owned resort and CUHSAW, though, is understood to have been much wider and little changed from their original multi-million dollar differences. The CUHSAW had initially been asking for “over $3m” - a sum near-triple the Grand Lucayan’s $1.1m proposal.

As for the BHMA, it had first sought a collective $5.4m payout for its members - double the $2.7m offered by the resort’s Board. The BHMA is thought to have moderated that demand somewhat, bringing it closer to the Grand Lucayan’s position, but the gap still remained too wide to bridge.

As reported previously by Tribune Business, the two unions had thus initially asked for a total $8.4m payout, which represents a sum more than double, or 121 percent higher than the resort’s total $3.8m offer.

The lower the compensation payout, the greater the savings for the Bahamian taxpayer who has ultimately financed the Grand Lucayan’s $65m acquisition and a series of subsequent multi-million dollar payouts to former owner, Hutchison Whampoa, along with $3.5m in renovation costs.

Mr Scott previously said settling the voluntary separation packages would allow the Government to fulfill its promise of permitting all staff wanting to leave to do so while simultaneously reducing the Grand Lucayan’s operating costs.

Besides the wage bill savings, he added that completing this process will also allow the Board and management to focus on operational efficiency and minimising expenses as they prepare Freeport’s sole remaining “anchor property” for sale to a private buyer.

“It allows the Government to keep one of its undertakings and promises,” Mr Scott told Tribune Business, “and allows us to move on with the next phase of the resort; its operations for the next six months and moving into the pre-sale phase. It also allows us to operate relatively cost efficiently.”