Starting April 15, the region's minimum wage for workers in the non-agricultural sector is now at P481, and in the agricultural sector at P444 MANILA, Philippines (UPDATED) – A wage hike of P15 for Metro Manila's minimum wage earners was approved by the regional wage board.
Starting April 15, the region's workers in the non-agricultural sector will receive a minimum wage of P481, while workers in the agricultural sector will have a minimum wage of P444.
Department of Labor and Employment communications director Nicon Fameronag announced the news on Wednesday, March 18, at the DOLE office in Manila.
The hike is set to benefit 587,000 workers, said Labor Secretary Rosalinda Baldoz, who also chairs the National Wages and Productivity Commission.
For workers who receive their salaries twice a month every 15 days, the increase will reflect in their April 30 pay slips.
The Regional Tripartite Wages and Productivity Board-National Capital Region (RTWPB-NCR) approved the resolution on the P15 increase, which is on top of the P15 Cost of Living Allowance in effect since January 2014.
DOLE NCR Director Alex Avila explained that the hike is consistent with government policy that takes into account workers' and their families' needs, as well as business stability.
“The take-home pay of our minimum wage earners will increase to P492.57 per day, or by 3.2%, because of the wage hike, compared to the current P477.03 per day. They will also enjoy a higher 13th month pay and increased social security coverage,” Avila said.
A workers' take-home pay includes the amount he will get from the law-mandated 13th month pay.
Avila explained that minimum wage earners are exempt from paying income tax on their wage. No taxes are imposed on their hazard pay, holiday pay, night shift differential, and overtime pay either.
He added that NCR businesses will be able to bear the cost and still sustain employment creation.
The P15 increase is the 5th wage since President Benigno Aquino III took office in 2010.
Calls for across-the-board increase
In a phone interview with Rappler, Fameronag explained that two wage hike petitions were filed before the RTWPB-NCR, asking for an across-the-board wage increase.
This, however, is not within the regional wage board's mandate.
"Unfortunately, the RTWPB is not mandated to set across-the-board wage increases. Our mandate is to set minimum wages," the board said in a resolution.
The board asked petitioners to conform with standards prescribed by law in petitions that will be filed in the future.
Trade Union Congress of the Philippines-Nagkaisa's Alan Tanjusay, however, asked the regional wage board to "show the formula they used as basis for the new wage order and subject it to healthy discussion."
"They better explain it to the workers immediately or else their lack of credibility may invite confusion, if not incite chaos, particularly among poor workers," he said, calling the P15 increase "revolting."
TUCP was among the petitioners before the RTWPB.
On the other hand, Kilusang Mayo Uno chair Elmer Labog said such "region-based wage hikes don’t address the attacks carried out against the minimum wage in the country for decades."
"We are fighting for the implementation of a National Minimum Wage in the amount of P16,000 monthly to give workers some immediate relief and to turn back the attacks against the minimum wage throughout the country,” Labog said.
He added that the wage hike is insufficient, considering increases in the prices of basic commodities and the fare hike in Metro Manila trains.
'Let market forces decide'
Reacting to the wage hike, lawyer Noel Balsicas of the People Management Association of the Philippines said the mandated minimum wage is an outmoded means of wage determination.
"This will have an effect on other personnel who are not directly affected by the increase through wage compression or wage distortion," he said.
Employers are now forced to increase the salary of a worker with a typically higher rate than a minimum wage earner to "restore the seniority of that individual."
Balsicas said it is better to let market forces decide salary increases instead of the government mandating them.
"It also backfires in a way to the workers," he added, explaining that manufacturers are now forced to increase the price of their products and services to sustain the higher salaries of their workers.
This creates an "additional pressure on the cost of living," he said, calling it a "chicken-and-egg situation."
Around 40% of manufacturing cost is labor, he added. – Rappler.com Buena Bernal
Wednesday, March 18, 2015
PHL hikes NCR minimum wage by P15
Over half a million minimum wage workers in the private sector in Metro Manila are due for a P15 increase in basic pay following the go signal from the wage board, the Department of Labor and Employment (DOLE) said on Wednesday.
DOLE-National Capital Region (NCR) director Alex Avila said the new minimum wage in the region has been raised to P481 for workers in the non-agriculture sector and to P444 for workers in the agriculture sector.
Avila said the wage board took into consideration several factors, including the erosion in the minimum wage, inflation rate, possible impact of the minimum wage adjustment on prices of goods and services, as well as on employment; movements in the consumer price index, the current economic condition in the region, employers’ ability to pay, and the results of its continuing studies, sectoral consultations, and public hearings.
"[The decision] consistent with the government’s policy of granting regular, moderate, and predictable minimum wage adjustments, taking into consideration the needs of workers and their families, as well as the need to maintain stability in the business environment within the framework of the two-tiered wage system reform," he said.
The minimum wage hike is expected to be affirmed by the National Wages Productivity Commission this week, and the Regional Tripartite Wages and Productivity Board (RTWPB) will publish it.
The new minimum wage takes effect 15 days after publication, Avila said.
The wage increase will benefit 587,000 minimum wage earners, said Avila, who is also the chairperson of the RTWPB-NCR.
The wage earners will continue to be exempt from paying income tax on wage and hazard pay, holiday pay, night shift differential, and overtime pay.
“The take-home pay of our minimum wage earners will increase to P492.57 per day, or by 3.2 percent because of the wage hike, compared to the current P477.03 per day. They will also enjoy a higher 13th month pay and increased social security coverage,” Avila said.
Labor cost
“On the part of the employers, their effective labor cost per employee working six day a week will also increase by 3.2 percent, or P565.54 per day, compared to the current P547.87 per day,” he added.
But labor group Trade Union Congress of the Philippines-Nagkaisa (TUCP-Nagkaisa) said the increase was unacceptable, noting it only serves to widen the gap between the rich and the poor.
"This amount is revolting. Rather than closing the gap between rich and poor, government officials in the Board has further widened the gaping inequality amongst Filipinos – between a few elite and a famished majority who live to survive by the day," TUCP spokesperson Alan Tanjusay said in a statement.
On March 6, TUCP asked the wage board for a P136 increase.
The labor group has dared government agencies – DOLE, Department of Trade and Industry, and National Economic and Development Authority – to reveal how the wage board came out with the P15 wage increase.
"This is a nature of social injustice that either makes our productive young workers... join the ranks of our Filipino brothers and sisters in the mountain to wage the battle on Philippine social inequality from there or forces them to decide to swallow the bitter pill by working abroad at the expense of a morally, psychologically and emotionally-deprived children,” Tanjusay said. – Danessa O. Rivera/VS, GMA News
DOLE-National Capital Region (NCR) director Alex Avila said the new minimum wage in the region has been raised to P481 for workers in the non-agriculture sector and to P444 for workers in the agriculture sector.
Avila said the wage board took into consideration several factors, including the erosion in the minimum wage, inflation rate, possible impact of the minimum wage adjustment on prices of goods and services, as well as on employment; movements in the consumer price index, the current economic condition in the region, employers’ ability to pay, and the results of its continuing studies, sectoral consultations, and public hearings.
"[The decision] consistent with the government’s policy of granting regular, moderate, and predictable minimum wage adjustments, taking into consideration the needs of workers and their families, as well as the need to maintain stability in the business environment within the framework of the two-tiered wage system reform," he said.
The minimum wage hike is expected to be affirmed by the National Wages Productivity Commission this week, and the Regional Tripartite Wages and Productivity Board (RTWPB) will publish it.
The new minimum wage takes effect 15 days after publication, Avila said.
The wage increase will benefit 587,000 minimum wage earners, said Avila, who is also the chairperson of the RTWPB-NCR.
The wage earners will continue to be exempt from paying income tax on wage and hazard pay, holiday pay, night shift differential, and overtime pay.
“The take-home pay of our minimum wage earners will increase to P492.57 per day, or by 3.2 percent because of the wage hike, compared to the current P477.03 per day. They will also enjoy a higher 13th month pay and increased social security coverage,” Avila said.
Labor cost
“On the part of the employers, their effective labor cost per employee working six day a week will also increase by 3.2 percent, or P565.54 per day, compared to the current P547.87 per day,” he added.
But labor group Trade Union Congress of the Philippines-Nagkaisa (TUCP-Nagkaisa) said the increase was unacceptable, noting it only serves to widen the gap between the rich and the poor.
"This amount is revolting. Rather than closing the gap between rich and poor, government officials in the Board has further widened the gaping inequality amongst Filipinos – between a few elite and a famished majority who live to survive by the day," TUCP spokesperson Alan Tanjusay said in a statement.
On March 6, TUCP asked the wage board for a P136 increase.
The labor group has dared government agencies – DOLE, Department of Trade and Industry, and National Economic and Development Authority – to reveal how the wage board came out with the P15 wage increase.
"This is a nature of social injustice that either makes our productive young workers... join the ranks of our Filipino brothers and sisters in the mountain to wage the battle on Philippine social inequality from there or forces them to decide to swallow the bitter pill by working abroad at the expense of a morally, psychologically and emotionally-deprived children,” Tanjusay said. – Danessa O. Rivera/VS, GMA News
NCR minimum wage earners to get P15 pay hike
MANILA -- Close to 600,000 minimum wage earners in Metro Manila are set to receive an additional P15 in their daily pay beginning mid-April which militant groups said is not even enough to cover for the recent increase in train fares.
Metro Manila's minimum wage is currently at P466 for those working outside the agriculture sector.
This will jump to P481 in the next few weeks after the Regional Tripartite Wages and Productivity Board-National Capital Region (RTWPB-NCR) issued Wage Order 19 on Wednesday. Minimum pay for agricultural workers will grow to P444.
“The minimum wage hike is expected to be affirmed and published this week and take effect 15 days after its publication,” said Department of Labor and Employment (Dole) spokesperson Nicon Fameronag.
The P15 pay hike is a far cry from the P146.80 across-the-board wage increase sought by the Association of Minimum Wage Earners and Advocates last November 2014 and the P136 across-the-board pay adjustment asked by the Trade Union Congress of the Philippines (TUCP) last March 6.
The last wage order was issued on September 6, 2013.
“In coming up with the figure, we need to consider the hard balancing job of factoring the concerns of employers, workers, and the government,” said Dole-NCR Director Alex Avila.
He added that they considered, among others, the erosion of minimum wage, inflation rate, impact of wage adjustment on prices of goods and services, consumer price index, employers’ ability to pay, and the current economic condition in the region.
“Like in the past years, employers will be able to bear the cost of the increase without hampering their viability for growth and expansion,” said Fameronag.
The NCR wage board said establishments, whose assets are not more than P3 million, are no longer allowed to apply for exemption from following the minimum wage rate.
Still allowed to apply for exemption are distressed establishments, retail/service establishments regularly employing not more than 10 workers, and establishments adversely affected by natural calamities.
Fameronag said 587,000 minimum wage earners are set to directly benefit from the wage order out of the 4.6 million workers in Metro Manila.
He said the labor department has already advised employers to also look into the issue of wage distortion with the issuance of the latest wage order.
Wage distortion arises when, after implementation of a prescribed minimum wage increase, existing salary differentials in the salary structure of an establishment are eliminated or severely contracted.
“It is a natural consequence during minimum wage increases to result to wage distortion. That’s why we have told employers that they may have to revisit their pay structure so that there will be no wage distortion,” Fameronag said.
Fameronag, however, clarified that the salary adjustment for non-minimum wage earners is not mandatory.
The TUCP assailed the decision of the NCR wage board, saying the amount is unacceptable.
“This amount is revolting. Rather than closing the gap between rich and poor, government officials in the Board has further widened the gaping inequality among Filipinos—between a few elite and a famished majority who live to survive by the day,” said TUCP spokesperson Alan Tanjusay in a statement.
The TUCP said the amount is offensive for workers considering the recent fare hikes implemented by the Metro Rail Transit (fare increase ranges from P8 to P16), Light Rail Transit 1 (from P5 to P10), LRT 2 (from P6 to P12) and the forthcoming Philippine National Railways fare hike (from P5 to P15).
Electricity and water rates in the capital region also picked up last month.
“Region-based wage hikes don’t address the attacks carried out against the minimum wage in the country for decades. We are fighting for the implementation of a national minimum wage in the amount of P16,000 monthly to give workers some immediate relief and to turn back the attacks against the minimum wage throughout the country,” said Kilusang Mayo Uno chairperson Elmer Labog.
According to independent think-tank Ibon Foundation, the so-called family living wage in the country, or the amount needed daily by an average Filipino family to live decently, stood at P1,086 last August 2014. (HDT/Sunnex) SunStar
DAGDAG SAHOD | 587,000 minimum wage earners in Metro Manila get P15 more in daily pay
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| Workers take a break. FILE PHOTO BY BERNARD TESTA |
The minimum wage, as well as the minimum wage earner’s hazard pay, holiday pay, night shift differential, and overtime pay, is exempt from income tax, said Alex Avila, regional director of the labor department’s Metro Manila office.
“The take-home pay of our minimum wage earners will increase to P492.57 per day, or by 3.2 percent because of the wage hike, compared to the current P477.03 per day. They will also enjoy a higher 13th month pay and increased social security coverage,” Avila said.
Labor Secretary Rosalinda Dimapilis-Baldoz, head of the National Wages and Productivity Commission (NWPC), said the new pay hike is the 19th increase in minimum wages since Republic Act 6727, or The Wage Rationalization Act, became a law on 9 June 1989, and the fifth such minimum wage pay hike under the administration of President Benigno Aquino III.
According to the resolution of the Regional Tripartite Wages and Productivity Board-National Capital Region (RTWPB-NCR) granting the P15 increase in the daily basic minimum wage, the P15 Cost of Living Allowance in effect since January 2014 will also continue.
“The minimum wage hike is expected to be affirmed by the NWPC this week, and the RTWPB will publish it, after which it will take effect 15 days after its publication,” Avila said in his report.
Avila also heads the RTWPB-NCR.
RTWPB - composed of representatives of labor and management, and the government, specifically the Department of Trade and Industry, National Economic Development Authority, and the DOLE – considered the following factors in its decision: the erosion in the minimum wage; inflation rate; possible impact of the minimum wage adjustment on prices of goods and services, as well as on employment; movements in the consumer price index; the current economic condition in the region; employers’ ability to pay; and the results of its continuing studies, sectoral consultations, and public hearings.
“The decision of the RTWPB-NCR to adjust the minimum wage was consistent with the government’s policy of granting regular, moderate, and predictable minimum wage adjustments, taking into consideration the needs of workers and their families, as well as the need to maintain stability in the business environment within the framework of the two-tiered wage system reform which Secretary Baldoz has initiated in 2012 and which we accelerate to implement,” said Avila.
Cost to employers
“On the part of the employers, their effective labor cost per employee working six day a week will also increase by 3.2 percent, or P565.54 per day, compared to the current P547.87 per day,” Avila said.
He expressed confidence that as in the past year, employers will be able to bear the cost of the increase without hampering their viability for growth and expansion and, therefore, their ability to sustain employment creation.
“In January 2014, when the second tranche of the minimum wage increase consisting of the integration into the basic minimum wage of the P15 of a P30 COLA granted by the RTWPB-NCR in October 2013 took effect, employment was at 88 percent, unemployment was at 11.2 percent, and underemployment was at 12.1 percent.
“Today, employment in the NCR is at 90.7 percent; unemployment is at 9.3 percent; and underemployment is at only 8.3 percent. So, we see that this significant improvements in these economic indicators will not be affected by the new minimum wage order, but instead continue until the end of the year and beyond, barring any glitches,” Avila explained.
With the increase, he said, the RTWPB was able to maintain a near-to-the-ideal ratio of the minimum wage to average wage, which is 40 to 70 percent, at 75 percent, down from 80 percent when the current administration came to office in 2010.
“The applicable minimum wage-to-average wage ratio for the country is not too close, to allow for bipartite approaches and flexibility in plant-level negotiations for further benefits,” he said.
In this latest minimum wage pay hike, Avila noted another bright note: Establishments whose total assets - including those arising from loans, but exclusive of the land on which the establishments’ offices, plants, and equipment are located - cost not more than P3 million.
“They are no longer included in the list of establishments that may apply for one year exemption. Only distressed establishments, retail/service establishments regularly employing not more than 10 workers, and establishments adversely affected by natural calamities may apply for exemption and as determined by the RTWPB-NCR,” Avila said.
Prior to this new wage order, the RTWPB-NCR received two petitions for an across-the-board daily wage increases. The first petition was filed by the Association of Minimum Wage Earners & Advocates (PTGWO-AMWEA) TUCP-ITUC last 28 November 2014 seeking for a P146.80 across-the-board daily wage increase, while the second petition was by the TUCP, filed on 6 March 2015, seeking for a P136.00 across- the-board daily wage increase.
Aside from its continuing studies and researches, the RTWPB-NCR conducted three public consultations last 29 January with the labor sector; on 10 February with the management sector; and on 17 February with the government sector. It also conducted a public hearing on 6 March to ensure hearing broad views and perspectives and to elicit participation of the social partners and key stakeholders.
“Unfortunately, the RTWPB is not mandated to set across-the-board wage increases. Our mandate is to set minimum wages,” the board said in its decision. - InterAksyon.com
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