Word that a private security firm pays its security guards less than half of what it charges its clients has raised a number of questions on job creation and minimum wage.
It has also sparked off discussions on the purpose of foreign direct investment policy, since the company in question is an FDI-created company.
Some people have gone to the extent of saying that if the FDI policy essentially means the outside company takes all the money at the expense of those back home, then there is no need to attract foreign direct investment.
The truth is nobody is going to come and invest in Bhutan, if there is nothing in it for him or her. FDI is not charity.
For the government, FDI is needed because it brings in the required capital to get things, for which it has no money, off the ground, like the education city and the high-end hotels. In the process, jobs are created and skills transferred. After a while when the lengthy tax holidays are over the government also earns in the form of taxes.
It is not the first time there have been complaints related to salary, particularly with the regard to FDI establishments.
When the high-end resorts first entered the country, almost every job seeker, from those leaving high school to those graduating from university, wanted to give it a shot. It looked exclusive, and serving millionaires and billionaires held other promises.
The local hotel industry feared it might lose all its employees, so the government stepped in and kept the wages at the local level. Those that joined soon felt underpaid for the kind of service world-class resorts demand. Many left, a few stayed behind, and the resorts are still running.
But what is upsetting in the case of the private security firm is that most of its clients that are paying double or triple of what is paid to the guards are government institutions and projects. To many, it appears that the government is doing all it can to ensure the company is profitable at the cost of its employees.
The government does not want to say anything, because the company is creating jobs and meeting legal provisions, and those employed will add up to the statistics to bring down the percentage of unemployment.
Part of the problem appears to be the minimum wage, which the government tried to keep at the minimum possible, so that costs don’t escalate for the government, as well as the private sector.
The likelihood is that many private enterprises are using the minimum wage to pay its employees, who work as sales people, waiters and cooks. But here the government and government projects do not sign a contract to pay for their services.
The government needs to sort out its public private partnership with the security firm, so that its employees benefit more.