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Puerto Rico governor’s office: Private sector supports repeal of wrongful terminations act

By on June 5, 2018

SAN JUAN – During the second day of public hearings on House Bill 1634, which addresses the repeal of Puerto Rico’s Act 80, the wrongful dismissals law–several business people and heads of associations testified in favor of Gov. Ricardo Rosselló’s measure, a press release issued by his office stressed.

The administration says the bill’s purpose is to comply with an agreement reached between Rosselló and the island’s fiscal oversight board so the latter would cease to require that the statutory Christmas bonus be optional for employers, as well that employee holiday and sick leave be cut.

The governor’s office, La Fortaleza, reiterated that Rosselló believes the agreement is “not perfect, but it is the most beneficial route for Puerto Rico, since it eliminates uncertainty and ensures the most important rights for the working class.”

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As examples of support for the repeal of the law that protects workers from being laid off without just cause, La Fortaleza said that in testimony as representative of the Puerto Rico Manufacturers Association (PRMA), Carlos Paula said the group “supports every effort by the Government of Puerto Rico aimed at fomenting economic and social development and creating the conditions that favor the creation of additional jobs.”

Paula also said, the release adds, that “because we understand that the repeal of Act 80 promotes the objective of making our jurisdiction more competitive, and that said proposal is a fundamental component of the agreement of the Government of Puerto Rico with the fiscal oversight board, the Manufacturers Association supports the general proposal and the purpose outlined in H.B. 1634, as presented by the governor.”

La Fortaleza pointed out that the PRMA represents “the entities that generate 48% of the Island’s gross national product,” and added that Paula said, “A business person will not fire employees only because there is no longer Act 80.”

Also cited in the release is CPA David Rodríguez, who testified on behalf of the Puerto Rico Chamber of Commerce, and said, “The accumulation of labor legislation in Puerto Rico is a real obstacle to the creation and retention of jobs and has contributed to turning us [the island] into an unattractive place for the type of investment that creates jobs.”

Nelson Ramírez, president of the United Retailers Center, said that “the labor laws of Puerto Rico are a straitjacket for companies and are often not introduced for these same labor restrictions,” and that repealing Act 80 “represents the best alternative for the full economic development of Puerto Rico, as well as the creation of more and better jobs,” the governor’s office cited.

La Fortaleza also quoted Emilio Colón Zavala, president of the Puerto Rico Builders Association, saying, “We understand that with the repeal of Act 80, private sector employees are not deprived of the various protections provided by special labor laws, through different forms of discrimination and the different causes of action recognized in the current legal system.”

La Fortaleza emphasized that “all the deponents agreed” that Lufthansa Technik Puerto Rico “is the best example of how the flexibilization of labor legislation has the potential to achieve the creation of better-paid jobs.”

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Act 32 of 2014 exempted the island’s aircraft-maintenance, -repair and -overhaul industry “from certain labor legislation to ensure that the Lufthansa company establish itself in Puerto Rico and not in Mexico,” La Fortaleza added.

On Monday, the governor’s office recalled, “the two economists who deposed before the Government Commission of the House of Representatives agreed that the repeal of Act 80 will allow for the economic growth of Puerto Rico by attracting jobs in a globalized and competitive economy.”

Economist Vicente Feliciano said, in the first hearing Monday, that Act 80 “prevents economic growth because the island is not competitive compared to the rest of the states and the world. He also highlighted other jurisdictions where the flexibilization of labor laws have resulted in economic growth,” La Fortaleza wrote, adding that economist Rafael Romeu said its repeal “is necessary to achieve economic growth by aligning the labor market of Puerto Rico with the rest of the jurisdictions of the United States, with which it competes.”

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