HISTORY OF COST OF LIVING ALLOWANCE

This piece published by the now defunct Council of Progressive Trade Unions on the History of the Cost of Living Allowance was first published in February 1987, although it is mistakenly dated February 1986. The quality of the original document made it difficult to reproduce it as a facsimile.

Spelling and punctuation have been cleaned up from the original and there has been reformatting of some paragraphs.

 
COUNCIL OF PROGRESSIVE TRADE UNIONS
 
 
HISTORY OF COST OF LIVING ALLOWANCE (C.O.L.A.)
Two years after the 1937 Riots and Insurrection (which began at Fyzabad, South Trinidad over log; wages and substandard conditions of oil workers) the 2nd World War began, Trinidad and Tobago, being a colony of Great Br1tain, became involved in the War which started in 1939 and ended in 1945.

Being an oil producing country, Trinidad and Tobago played a very important role in the war, supplying petroleum to Great Britain, to fuel and lubricate the war machinery of the mother country.

The War brought to Trinidad and Tobago high prices for food and other basic necessities due to shortages and increased demand. At the same time, workers, particularly those in the oil industry, were called upon by the colonial authorities to produce more oil to meet the increased demand of the war. Being loyal and opposed to Hitler's fascism, Oil workers in Trinidad and Tobago rallied to this call and oil tankers filled with petroleum products left the ports of South Trinidad across the Atlantic to Great Britain.

During this period the war effort not only consumed vast amounts of our oil but our finances as well. After all we were part of the British Empire and the resources of Trinidad and Tobago, human, mineral and financial were directed toward the war effort. So that in addition to increased productivity in the oil industry, oil workers were also requested to forego wage increases during the war period.

This must have been a bitter pill for oil workers to swallow as it was only two years before that they had combined into trade unions and were expecting increases in wages and conditions of employment. But the dangers of Hitler’s Germany were enough to convince oil workers of the need to sacrifice.

So that the Oilfields Employers’ Association comprising in the main the British companies of Trinidad Leaseholds Ltd (TIL), United British Oilfields of Trinidad (UBOT), Apex Trinidad Ltd and Trinidad Petroleum Development Company (TPD), successfully negotiated a wage freeze with the newly formed militant Oilfields Workers Trade Union, led by such Labour stalwarts as Adrian Cola Rienzi and John Rojas (TUB Butler was interned on Nelson Island during the duration of the war as he was considered a security risk).

Steep rises in the cost of living created severe economic hardships for oil workers during this period and despite agreement for wage freezes, the oil workers union was forced to make representations to the oilfields employers for some relief.

It was in the course of finding a solution to this problem that the OWTU and the OEA negotiated a War Bonus of one cent (1¢) an hour to relieve oil workers from the high inflation caused by the war.

This War Bonus came into effect on 29th January 1940 principally because of the wage freeze and inflation at the time. Working a 40 hour week oil workers at the time received an average income of five cents an hour and the War Bonus of one cent an hour, so that the weekly wage was $2.40 and the weekly War Bonus, 48 cents.

While oil workers played a major role in the war effort, they were not the only workers affected by wage freezes and inflation and it was not long after that other workers in the country were able to justify such a War Bonus. So that this benefit to cushion inflation soon spread throughout the country to other workers.

At the end of the war the name was changed to Cost of Living Bonus or Cost of Living Allowance (COLA) and was tied to the index of retail prices which measures the inflationary rates of goods and services in the country.

COLA thereafter became a normal part of the workers remuneration package, even being extended to some non-unionised workers as well. This benefit has been in existence for 47 years and at the end of each collective agreement the allowance goes into the last wage paid, thereafter becoming a part of the workers wage. This situation has caused employers wanting

Using the declining state of the national economy brought about by a decline of oil prices, employers over tire last two years have been seeking to have this allowance removed from industrial agreements.

Trade Unions have refused this request and the Industrial Court has so far in its judgements ruled in favour of trade unions and retained the Cost of Living Allowance. This situation has caused employers wanting this allowance removed to institute Lock Out Action in accordance with the provisions of the Industrial Relations Act, thereby preventing the dispute over the Cost of Living Allowance to be adjudicated by the Court. In such cases of legal Lockout Action, workers are invited to sign individual contracts of employment without provisions for the cost of living allowance.

The six month lockout of the hourly rated workers of Federation Chemicals is an example of the bitter struggle between employers and trade unions over this benefit, which coincidentally was born during the last World War. It is ironical that a war bonus has created a virtual industrial relations war between employers and unions.

Fifty years after the birth of the Trade Union Movement, workers in Trinidad and Tobago are struggling to maintain a benefit which was won as a result of the costly sacrifices made by workers in Trinidad and Tobago. Sacrifices which no doubt contributed to a great extent to the victory of the Allied forces over fascist Germany in the 2nd World War of 1939 -1945

During a three year period of 1984-1986, employers in Trinidad and Tobago instituted thirty six lockouts. In 1986 alone, seventeen lock outs were instituted by employers. Since the battle over COLA began, workers in sixteen companies have lost this Allowance.

The frequency of these lockouts caused the new cabinet of prime Minister Robinson to agree to institute Section 65 (1) of the I.R.A. in order to settle the protracted lock out of the Federation Chemicals workers. However, in a new move the Government changed its position and instead decided to introduce a new sub section 61(d) which empowers the Minister to refer a strike or lock out to the Industrial Court after three months on the request of any or both of the parties to such a dispute.
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