A serious cash-flow problem has left Caribbean Cement Company unable to meet its monthly payroll today.
Instead, the company has told its monthly paid employees that it would attempt to pay them no later than Friday.
"The company apologises for any inconvenience that may result from the delay in payment of salaries, but it is severely challenged at this time, given the sustained contraction in the economy and its impact on our sales and, by extension, cash flow," Caribbean Cement said yesterday in a letter to its employees.
According to the company, it remained committed to the welfare of its staff and "solicits your cooperation at this time as we navigate this very difficult and challenging period".
But the Union of Clerical, Administrative and Supervisory Employees (UCASE), which represents the more than 80 monthly paid workers at the cement company, is not convinced by management’s claim that it is concerned about the welfare of the workers.
"On a matter of principle, the company should have given the workers more notice. If it cannot pay, there is nothing we can do, as we can’t call a strike to force them to pay, but we have to ask why the workers were not told from last week," said Navel Clarke, general secretary of the UCASE.
"I will be meeting with them tomorrow (today) and I want to know what will happen in the case where a worker has a bill to pay on the 25th and could face some penalty if the payment is late. How will the company compensate these workers?" Clarke asked.
Caribbean Cement Company has been under pressure in recent months, with a decline in local sales caused by the slowdown in the construction sector and competition from importers.
The company has reported an estimated drop in its local-market share from 85 per cent in the first three months of this year to 82 per cent in the April to June quarter.
But an increase in export sales helped the company to report consolidated net profit after tax of J$216.14m (US$2.54m) for the first six months of the year.
Operating profit of J$610.53m (US$7.1m) for the six-month period was 36 per cent better than the corresponding period in 2008.
However, interest cost of J$75.5m and loss on currency exchange eroded its performance and resulted in net profit after tax of US$216.14m.
That was US$56m, or 21 per cent below the result for the corresponding period last year.