Simpson Bay Resort wins appeal case against WIFOL

September 01, 2012 3:48 PM

PHILIPSBURG--Simpson Bay Resort Management Company (SBRMC) NV and Royal Resorts (RR) Management Company Ltd. won the appeal case Friday against Worker's Institute for Organised Labour (WIFOL) concerning the employment of union members at the former Pelican Resort.

After the auction of Pelican Resort Club in December 2010, a conflict ensued about the labour conditions of 182 employees. New owner SBRMC did not believe itself obligated to adhere to the Collective Labour Agreement (CLA) closed with former Pelican Resort employees that were unionised with WIFOL, because it was not unified with the former Pelican Resort Club Management Company NV (PRCMC), and therefore not responsible for the workers' labour arrangements and conditions as agreed with PRCMC.
 
The conflict resulted in a prolonged legal battle and numerous court proceedings.
 
In Friday's ruling, the Appeals Court nullified a verdict of 2 April, in which the Court of First Instance had ordered the resort to adhere to all CLA stipulations for line personnel, supervisors, middle management and administrative personnel of the former Pelican Resort Club, to pay WIFOL members' salaries retroactively and pay the union US $50,000 in damages.
 
The three-judge panel, presided over by Joint Court President Lisbeth Hoefdraad, stated St. Maarten law does not contain the stipulation that companies involved in takeovers are to adhere to labour agreements with employees that were hired by their previous employer. This would only be the case if workers were employed according to existing labour agreements and the new employer did not object.
 
In the explanation of the draft-National Ordinance Labour Agreements, which has not yet been submitted to Parliament, it is stated that company takeovers are considered "politically sensitive," the Appeals Court added.
 
SBRMC informed WIFOL on 17 December 2010 that it would operate the resort and would offer six-month contracts to PRCMC employees; an offer WIFOL turned down.
 
Negotiations about the conditions under which PRCMC workers would be employed by SBRMC remained fruitless, while involvement of the Government Mediator also proved futile. All this made clear the resort had "had no intention to continue the labour agreements just like that," the Appeals Court wrote in its verdict.
 
The Court also dismissed claims RR and SBRMC would have used a "malicious leveraged die-out" of the resort to "rob" PRCMC workers of their protection against dismissal and to "frustrate" the formation of collective labour conditions. This would not match with RR's request filed on behalf of PRCMC on January 18, 2011, for the dismissal of 182 employees, the Appeals Court stated.
 
"Management is very pleased with the outcome of the appeal," SBRMC General Director Mark Miller said Friday afternoon during a press-conference at Bloem and Associates law office.
 
"We could not have continued operating the resort with the labour contracts we were forced to adhere to," Miller said. The resort claims that adherence to the "Pelican CLA" would have cost $6 million, which the company would not have been able to pay without a considerable increase of timeshare fees.
 
It was stated that the resort, which is under a moratorium to avoid bankruptcy since July 19, had lost some 3,000 timeshare members in the past 18 months.
 
Four WIFOL members and SBRMC employees had requested the Court of First Instance to declare the company bankrupt in May, to force the company to abide by the now nullified court ruling of April 2. It is not yet known what effect the ruling will have on this moratorium.
 
"The Court of Appeals has set the record straight" in an extensive and quite detailed verdict, attorney-at-law Jairo Bloem said. He also pointed out this was the third time that the Appeals Court had destroyed a verdict of the Court of First Instance in the long judicial debate.
 
"This is a joyous day for the resort," Bloem said about the resort, which "had suffered from many negative statements in the media."
 
He commended the 91 employees who had pulled together with management to keep the resort going, and advised the other unionised workers to seek recourse against PRCMC and apply for severance pay with Social Security Fund SZV.
 
In looking forward, the resort said it would adhere to all rules in case the current workers would want to become unionised, whereas it would also be willing to draft a social plan.
 
It was said the employment of temporary workers at the resort had not changed significantly. Pelican Resort counted 181 workers with permanent contracts and 100 outsourced temporary workers. Simpson Bay Resort currently has 91 permanent employees and between 30 and 40 outsourced workers. Bloem said all temporary workers were properly documented.
 
Resort management is confident the verdict will be upheld in case of an appeal at the High Court in The Hague.
 
"We will submit this case to an attorney specialised in High Court cases to assess whether technical mistakes were made," WIFOL attorney Wim van Sambeek said about the possibilities of an appeal to the High Court. He described Friday's ruling as "very disappointing for the employees."

In this case Simpson Bay Resort Management Company (SBRMC) is represented by attorney Jairo Bloem of Bloem & Associates. Workers Institute for Organised Labour (WIFOL) is being represented by Maarten Le Poole and Wim van Sambeek of HBN Law.

Related articles:

- Moratorium, trustees in place at Simpson Bay Resort Company

- WIFOL’s ‘willing to talk’ with Simpson Bay Resort

- Resort threatens again with closure: Court rejects Simpson Bay Resort’s request to freeze April 2-ruling

- Court turns down challenge request in Simpson Bay case

- Lawyers challenge judge in Simpson Bay Resort case

- Van Sambeek: Simpson Bay Resort unresponsive to negotiation efforts

- Surprise ruling by Sint Maarten court

- WIFOL wins case in ongoing Simpson Bay Resort struggle