Employers, workers hit approved pay hike

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MANILA, Philippines — Wage hikes ranging between P30 and P110 are set to take effect in at least 14 regions this month, according to the Department of Labor and Employment (DOLE).

Labor Secretary Silvestre Bello III said in a statement that minimum wage earners, including domestic workers, were expected to benefit from a series of pay hikes across the regions starting this month and until early next year.

But both employers and workers groups rejected the wage hikes, saying the increases would discourage investments and the amounts of the wage hikes were too small to meet the rising cost of living.

“We proposed the P750 increase [because that was the] closest to the daily cost of living,” said former Anakpawis Rep. Ariel Casilao.

Casilao’s group and other labor organizations have been pushing for a nationalized wage adjustments, saying that while prices of basic commodities in the National Capital Region are lower, their daily wages are higher.

Differing costs

But in the provinces, prices of goods are higher but the prevailing wages are lower, Casilao said.

Employers’ groups, however, said the wage increase was a “misstep” at a time when most companies were still recovering from the impact of the COVID-19 pandemic.

“What deserves greater attention is the primordial need to create more jobs and preserve those that still exist. This cannot be addressed by adding to the cost of doing business fueled by a wage increase,” the Employers Confederation of the Philippines, Philippine Chamber of Commerce and Industry, and Philippine Exporters Confederation said in a joint statement.

In the Davao region, for instance, the Pilipino Banana Growers and Exporters Association (PBGEA), said the P31 wage adjustment approved in the region represents a 12-percent adjustment in the minimum wage.

“What will happen? Most likely, companies will reduce their workforce to sustain their operations, especially [those] in the agriculture and service sectors,” said Stephen Antig, executive director of PBGEA.

Layoffs expected

He said retrenchments would likely result in an increase of the unemployment rate in the region.

“[The adjustment] should have been just a bit higher than the inflation rate. Our inflation rate average is just 5 percent,” Antig said.

Although Vicente Lao, chair of the Mindanao Business Council, agreed that workers needed the wage adjustment, the P31 wage hike was “a bit high.”

The Regional Tripartite Wages and Productivity Board in the Davao Region approved the wage adjustment on May 31, although it was only announced on Friday.

The adjustments will be carried out in two tranches, with the first P16 increase to take effect on Jan. 1, 2023, and the other P15 to follow in the second quarter of the year.

Once the order fully takes effect, workers in nonagriculture, industrial, commercial and retail firms employing more than 10 workers will receive a daily minimum wage of P443, while those in the agriculture sector will receive P5 less.

Companies with 10 workers and below can seek exemption from the new wage order if they were affected by calamities.

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