Puerto Rico House President Carlos Méndez’s decision Monday to delay a vote on the repeal of a labor law may foreshadow heightened conflict between the local government and the Oversight Board.

The vote to repeal Law 80 would have led to at-will employment in the territory. The Board had demanded the repeal in exchange for concessions it made to Gov. Ricardo Rosselló.

Puerto Rico House President Carlos Mendez
Puerto Rico House President Carlos Méndez postponed a vote on a 1976 labor law when he realized he didn't have enough votes to repeal it.

Both the board and Rosselló are separately trying to control government policy after about a dozen years of nearly continuous economic decline and defaults on most of the island’s roughly $74 billion in public sector debt.

Méndez chose to delay the vote because he didn’t have the votes to pass a complete repeal of the measure, as the board has demanded, according to Puerto Rico Rep. Luis Vega Ramos. Vega Ramos is a member of the opposition Popular Democratic Party and Méndez is a member of the New Progressive Party along with the governor.
The House leader didn't have the votes to pass it, so he postponed the vote.

Failure by the House to repeal Law 80 may put the board and the Rosselló administration on the road to a confrontation.

The repeal of the law was part of a May 20 compromise over the board’s April-approved fiscal plan. The board agreed to drop the plan’s elimination of the Christmas bonus and reductions to mandatory vacation and sick days. In exchange, the governor agreed to introduce at-will employment by repealing Law 80.

The Puerto Rico Senate on May 30 voted 22-9 for a measure that would introduce at-will employment only for employees entering the workforce in the future. The board had demanded a repeal of Law 80 – which since 1976 has allowed Puerto Rico employees to appeal terminations – for all of the island’s workers.

On June 4 board executive director Natalie Jaresko sent a letter on behalf of the board to Puerto Rico Rep. Jorge Navarro Suárez explaining what the board would do if the House failed to repeal Law 80. Jaresko said that “at a minimum” the board would revert to the April fiscal plan and submit a budget consistent with the fiscal plan.

Jaresko said this would mean the board would reduce the number of mandatory sick and paid leave days and eliminate: a public employee Christmas Bonus appropriation; requirements for the bonus for private sector as well as public sector employees; an annual appropriation of $50 million for municipal economic development initiatives; a multiyear $345 million economic development and reform implementation initiatives fund; and an annual $25 million appropriation for University of Puerto Rico scholarships.

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