Ferguson: VSEPs for Grand Lucayan employees delayed

Ferguson: VSEPs for Grand Lucayan employees delayed
The Grand Lucayan Hotel.

NASSAU, BAHAMAS – Trade Union Congress (TUC) President Obie Ferguson said yesterday that while he expects the government and the Grand Lucayan’s board to make good on their commitment to be fair to the employees of the resort with the voluntary separation packages (VSEPs), the disbursement of those funds has been delayed.

Ferguson said, however, there is a more fundamental challenge: coming to an agreement of the final offer.

According to the president of the umbrella union, the government’s special purpose vehicle (SPV), headed by Michael Scott, capped the VSEP offer at 12 years per employee, despite many of them working for the resort for more than two decades.

He said not only is this unfair, but it is not in line with the tenets of VSEP offers.

Ferguson said the union expects the value of the offer to those managers and supervisors to near $4.2 million.

He noted that employees are also entitled to an annuity payment stemming from a 2007 program.

The SPV, the Lucayan Renewal Holdings Limited, has offered between $3.2 million and $3.3 million, according to Ferguson.

Ferguson told Eyewitness News Online he has reached out to Prime Minister Dr. Hubert Minnis in hopes of coming to an agreement over the way forward.

“I made a request to the prime minister to meet with him on that,” Ferguson said.

“I have not to date gotten a response on that.

“I suspect it will happen very soon, but I am not aware of any disbursements being made to the workers.

“We wanted to meet with the prime minister because of the position of…Mr. Scott.

“He wants to pay the workers on the basis of 12 years, even though they would have worked 21 years in some instances.

“We think that is totally unfair.”

Lucayan Renewal Holdings Chairman Michael Scott originally estimated the VSEP offers would cost taxpayers around $3 million to finance the exercise.

He later advised that the line staff and managerial unions which represent employees at the government-owned resort requested payouts that exceeded the resort’s offer by $4.6 million.

Last November, he said the Bahamas Hotel Managerial Association, which represents middle management, demanded $5.4 million in payouts for its members – double the resort’s board’s offer.

In recent weeks, Scott said despite concerted attempts to negotiate and come to an agreement, the resort’s board was unable to meet the unions’ demands.

He suggested that the board will make a generous offer in the context of its budget and the country’s fiscal constraints and those who do not accept will be considered as having opted to remain at the resort.

The VSEP offer was part of an overall strategy to streamline the operational costs of the resort and put it on a path to profitability before its resale, which the government hopes to achieve in the second quarter of next year.

The government said the VSEPs would be completed before Christmas.

Last week, Minister of Finance Peter Turnquest told the media funds had been allocated for the VSEPs package, but he could not confirm whether the payments were made.

Attempts to reach Scott were unsuccessful.

The SPV was established to hold the assets and manage resale.

The government purchased the resort for $65 million, with $30 million paid up front.

It borrowed the balance from the former owners, which will be a government-guaranteed mortgage paid over three and a half years.

While Scott originally projected it would take three to six months to resell the resort following the September purchase. However, Minister of Tourism Dionisio D’Aguilar noted last month that the government expects the resort to be sold by the second quarter of next year.

A reported two-dozen entities have expressed interest in purchasing the resort.