High wage hike seen ‘to affect small business’

A HIGH wage increase may cause a shutdown or mass layoffs for small to medium scale enterprises (SMEs), a Cebu business leader warned yesterday.

Prudencia Gesta, Cebu Chamber of Commerce and Industry (CCCI) president, said any wage increase should consider not only the workers but the small businesses as well.

“Big companies like banks or big factories don’t have to worry because they are already giving more than the P305 daily minimum wage. I am only concerned about the SMEs who comprise 98 percent of the business community,” he said.

“We trust that the wage board is competent to make the right decision.”

Philip Tan, president of the Mandaue Chamber of Commerce and Industry, said the moves of the regional wage board would be closely watched.

”The wage board should balance the amount of increase and make sure it doesn’t affect businessmen, especially small and micros enterprises. The supervening condition, I think, is temporary. I hope the board will come to a balanced decision that’s good for all.”

Last Thursday the Regional Tripartite Wages and Productivity Board in Central Visayas (RTWPB-7) approved a resolution to start entertaining wage hike petitions without waiting for a one year lapse of the last wage order dated Sept. 22, 2011.

Voting 3-2, the board said the rising inflation rate and weakened purchasing power of the consumer were a “supervening condition” that merit earlier than usual discussion of a new wage increase.

Two petitions are pending before the RTWPB-7 – a P90 across-the-board wage increase proposed by the Associated Labor Union-Trade Union Congress of the Philippines’ (ALU-TUCP) and a P121.84 wage hike by the Association of Progressive Labor (APL).

ALU-TUCP lawyer Ernesto Carreon, who moved for the declaration of a supervening event, said they will try to have the wage increase implemented on the first week of October or before the end of November.

Public hearings will be conducted before the wage board makes a final deliberation. The minimum wage in Metro Cebu is P305.

Richard Gonato, a cashier bagger who works in one of the malls in downtown area said he wishes that the minimum wage would be raised from P305 to at least P350.

He spends P150 everyday for food and transportation and saves the rest of his money for his lodging expenses.

He said it has been a while since he sent money to his family due to the rising costs of commodities. “For us, P305 is really not enough,” he said.