One day before collecting their bonus in convertible pesos, known as CUCs, which the Cuban government usually pays to certain institutions, close to sixteen thousand employees from ETECSA, the only telecommunications company on the island, got their second piece of bad news for the month of July.
In the previous days, the company had already started discreetly “downsizing.” This is a nice way of saying they started firing the first few hundred employees so that, according to the company’s executives, “it becomes more efficient and streamlined.”
This new unemployment shock – euphemistically known in Cuba as “relocation” – is part of the plan for strengthening the economy drawn up by General Raúl Castro, the country’s president, who in April during a speech to the Congress of Young Communists, said it would affect more than a million workers.
The unemployment phenomenon, which is vehemently denied by high officials in the government, is nothing new. In 2002, the last year for which there is data, unemployment was 3.3%, but independent economists say the real rate was much higher and is currently over 25% of the Cuban workforce.
Years ago, the government used to pay 60% of their last salary in Cuban pesos to the unemployed during the first 3 months, and offer them training courses. Now, according to the recently downsized employees from ETECSA, they’ll be paid 60% of their former salary just for one month, and then they’ll be on their own.
Besides “downsizing,” the other piece of bad news arrived the day before they collected their CUC bonus, when a memorandum notified them that due to a coordination failure, starting in April, the needed amount of convertible money had not been assigned to ETECSA by the responsible government institutions.
Until July the company had been able to make payments drawing from its reserves of hard currency. But in July there was nothing left. Many employees are angry. On the island, the convertible peso is essential when it comes to buying the basics, such as food, cooking oil, and clothes.
Alejandro, 32, tells how discussions between the workers and their bosses have turned into arguments. “Insults, openly criticizing the government, and calls to stop work until we are paid in hard currency.”
A white collar ETECSA worker earns between 400 and 800 Cubans pesos plus 27.50 in hard currency. Adding it all up it’s less than 60 USD per month. Until the year 2009, the company was a joint venture between the State and an Italian partner.
The Italian partner paid all salaries to a government institution, in hard currency. “For instance, for an engineer the government received up to 2 thousand euros from its foreign partner, and then the state paid 50 the equivalent of fifty CUCs in a combination of hard currency and Cuban pesos. If that is not exploitation, I don’t know what is.”, says Diana.
But it might not be as bad as all that. Company executives have taken notice. According to office rumors they expect there to be a meeting in August where the government would give them the hard currency.
Together with the Tourism Ministry and the Institute for Civil Aviation, ETECSA forms the small group of Cuban institutions which make a profit. This is the reason many employees can’t understand the lack of money to pay their July salaries. The don’t know if they’ll ever be paid either.
Picture: ETECSA main office, in Aguila y Dragones, La Habana. Built in 1927, this building housed the Cuban Telephone Company.
Translated by: Xavier Noguer