Dominican Republic and Haiti: Country Studies

Dominican Republic: The Economy
pie to reducing the level of public-sector overstaffing, it
allowed government personnel recruitment to increase 6.4 percent
in the first half of 1998. Moreover, the government has
expressed reluctance to undertake public-sector layoffs despite
a favorable economy.
In the 1980s, the most controversial labor law was the one
governing the national minimum wage. Although the Congress
increased minimum wages on several occasions during the
decade, unusually high inflation, which reduced the real wages
of workers, usually outpaced these increases. General strikes or
other confrontations between labor and government frequently
resulted. Government officials were reluctant to grant
frequent raises in the minimum wage, in part, because they felt
the need to keep Dominican wages competitive with those of
other developing countries. Dominican wages did indeed
remain lower than those in other Caribbean Basin countries,
with the exception of impoverished Haiti.
A new labor code promulgated in May 1992, however, provided
for increasing a variety of employee benefits. The minimum
wage was raised twice in the next two years by a total of 20
percent, substantially more than the rate of inflation or devaluation.
Public- and private-sector minimum wages were also
increased by approximately 20 percent in 1997, resulting in a
considerable rise in the Dominican Republic's labor costs.
Although labor unions appeared only after the Trujillo era
and only in the form of poorly financed and politically divided
peasant-based movements, the Dominican constitution provides
for the freedom to organize labor unions and for the
right of workers to strike (as well as for private-sector employers
to lock out workers) . All workers, except military and police
personnel, are free to organize, and workers in all sectors exercise
this right. Organized labor, however, represents no more
than 15 percent of the work force and is divided among three
major confederations, four minor confederations, and several
independent unions. The government respects association
rights and places no obstacles to union registration, affiliation,
or the ability to engage in legal strikes.
Requirements for calling a strike include the support of an
absolute majority of the workers of the company, a prior
attempt to resolve the conflict through arbitration, written
notification to the Secretariat of State for Labor, and a ten-day
waiting period following notification before proceeding with a
strike. The Labor Code specifies the steps legally required to
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