San Diego Union Tribune

January 28, 2007

Minimum wage debate stirs up fears in tuna industry

American Samoa's economy could be hurt

COPLEY NEWS SERVICE

WASHINGTON – San Diego's Chicken of the Sea is caught in the political churning on Capitol Hill over whether American Samoa and the tuna industry that dominates the island should be required to impose a minimum wage that could double the average wage there now.

Representatives of the tuna industry worry that such wage increases would devastate the American Samoan economy as it tries to compete with much lower-wage tuna processing facilities elsewhere in the developing world.

 

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As a U.S. territory, American Samoa isn't subject to U.S. labor laws. Instead, the U.S. Labor Department oversees a special committee that sets the Polynesian territory's wage standards. For years, American Samoa's lower wages reflected the generally lower cost of living there.

More than 80 percent of American Samoa's private economy depends on two tuna processors, Chicken of the Sea, and StarKist, based in San Francisco, which also opposes changes in the salary's ceilings.

Republicans are pushing for Congress to dramatically increase American Samoa's wages to be in line with minimums that apply to the states.

The Democratic-controlled House recently voted to raise the minimum wage in the Northern Marianas Islands but not American Samoa. The Northern Marianas are dominated by Republicans, while American Samoa leans Democratic. GOP lawmakers said the House exemption for American Samoa reflected favoritism for the American Samoa House delegate, Eni F.H. Faleomavaega, a Democrat, who opposes the higher minimums.

The string of islands' two canneries say they are trying to stay away from the congressional debate.

Faleomavaega said exorbitant wage increases could result in the departure of one of the canneries or a decrease in production from the Pacific territory. The result “could devastate the local economy, resulting in massive layoffs and insurmountable financial difficulties,” he said.

American Samoa tuna processors pay a minimum wage of $3.26. Its competitors, including foreign processors in the Philippines and Thailand, pay only 67 cents per hour. China and Vietnam pay less than 20 cents per hour.

After nearly a decade of debate on the issue, the House recently passed a bill that would boost the minimum wage from $5.15 per hour to $7.25 per hour in increments over the next two years.

The Senate last week delayed consideration of legislation to raise the minimum wage.

Rep. George Miller, D-Concord, chairman of the House Education and Labor Committee, authored the minimum wage bill that included the Northern Marianas but not Samoa. Miller had visited Northern Marianas in the 1990s and determined there were massive labor abuses in the island and its wages should be increased, his spokesman said.

Since Republicans have complained about America Samoa's exemption to the House minimum wage bill, however, Miller has decided to re-examine the issue. American Samoa is the only territory not subject to the minimum wage provisions.

Rep. Eric Cantor, R-Va. charged that House Speaker Nancy Pelosi, D-San Francisco, worked to exempt StarKist, owned by Del Monte Foods of San Francisco, from the bill. Del Monte and Pelosi have denied the claims.

But Pelosi asked the House Education and Labor Committee to review the wage situation involving American Samoa, which has a population of more than 57,000.

“Congress needs to make sure that workers are paid and treated fairly in all U.S. states and territories,” said Tom Kiley, a spokesman for Miller. “Wages in American Samoa remain low by national standards. Anytime anyone raises a policy issue, (Miller) is willing to look at it.”

Miller said he wants to ensure the wage board is acting equitably.

“Our committee will review minimum wage standards in American Samoa to determine how we can ensure the fair treatment of Samoan workers,” said Miller's spokesman, Kiley.

In determining whether to change wage ceilings, the board takes into account several factors, including standard of living and determines whether wages would adversely affect employment. Since 1987, wage boards for American Samoa have increased minimum wages for tuna cannery workers eight times.

The two American Samoa processors, Chicken of the Sea and StarKist, said they supported delegate Faleomavaega's actions, but appeared to be reluctant to become engaged in a full-blown political debate over the minimum wage.

Chicken of the Sea employs more than 1,000 employees in American Samoa and 100 in San Diego.

Chicken of the Sea spokesman Mike Rose said Faleomavaega “sums up the situation best” in his statement that he did “not support efforts to fully maintain minimums to America Samoa at this time.”

“This is a political debate better left with the lawmakers, and it's our hope that at the conclusion of this, it's in the best interest of the people of American Samoa,” Rose said.

Melissa Murphy Brown, a spokeswoman for Del Monte Foods, the owner of StarKist, said the company supports Faleomavaega, saying that he is working to keep the “fishing and tuna canning industries viable in American Samoa.” StarKist employs more than 5,000 Samoans.

Bumble Bee, the other major tuna producer based in San Diego, has production locations in the United States, Puerto Rico, Canada, Fiji, Trinidad, and Mauritius.

It has no plants in American Samoa, but its officials said they oppose any increase in the minimum wage.

Such increases “will negatively impact the cost of production for American processors and provide further disadvantages compared to foreign imports,” said David F. Melbourne, senior vice president for Bumble Bee Foods.

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