Philippines Resumes Hearings on Minimum Wage Hike Bills Amidst Labor-Management Divide

The Department of Labor and Employment (DOLE) on Tuesday defended the country’s regional wage-setting system as the House of Representatives Labor and Employment Committee resumed hearings on bills seeking legislated minimum wage increases. Labor Undersecretary Felipe N. Egargo, Jr. said the agency remains guided by Republic Act No. 6727, which authorizes the National Wages and Productivity Commission and Regional Tripartite Wages and Productivity Board to set regional minimum wages. He said the Labor department has submitted its technical inputs to Congress, stressing that the existing system considers “both the right of workers to a living wage and the right of business and industry to a reasonable return on their investment, expansion and growth.” During the hearing, Party-list Rep. Raymond Democrito C. Mendoza urged lawmakers to fast-track House Bill No. 88, which seeks a P200 across-the-board daily wage increase. Recalling that a similar proposal failed to pass in the previous Congress, Mr. Mendoza said he hopes there would be “no repeat performance this time,” adding that the measure would benefit more than five million minimum wage earners and boost household spending. Party-list Rep. Antonio L. Tinio, meanwhile, pushed for a P1,200 nationwide minimum wage, saying businesses could afford the increase based on available studies. He rejected claims that higher wages would fuel inflation, arguing that the minimum wage should provide a living wage. Iloilo Rep. Lorenz R. Defensor proposed a staggered increase instead of a one-time adjustment, saying a phased approach would raise workers’ pay while giving businesses time to absorb higher labor costs. “If the increase is too large and implemented all at once, the bill will likely fail,” he said. “But if the increase is reasonable and gradual, I am confident it can be enacted.” Labor groups renewed their calls for a legislated wage increase. At the hearing, IBON Foundation Executive Director Jose Enrique “Sonny” A. Africa said a family living wage is “urgent, just and doable,” arguing that workers’ purchasing power has declined even as available data show many businesses could afford higher wages. He added that raising wages would support household consumption and economic growth. Renecio “Luke” S. Espiritu, president of Bukluran ng Manggagawang Pilipino, said the widening gap between the minimum wage and the cost of living makes a legislated increase necessary. He also argued that opposition has largely come from bigger companies rather than micro, small and medium enterprises. He noted that both chambers approved wage hike bills during the 19th Congress before they failed to become law. Josua T. Mata, secretary-general of Sentro ng mga Nagkakaisa at Progresibong Manggagawa, described the proposal as “wage recovery,” saying workers have already lost 23% to 30% of their real wages. He also opposed a staggered increase, saying, “Justice delayed is justice denied.” Business groups, however, maintained their opposition. Clarine P. Tobias of the Employers Confederation of the Philippines said a legislated nationwide wage increase would bypass the existing tripartite wage-setting system and could lead to business closures, job losses, inflation and weaker investment. Arturo “Butch” Guerrero of the Philippine Chamber of Commerce and Industry likewise opposed the proposed P200 increase, warning it could quicken inflation, reduce competitiveness, discourage investment and hasten automation. “The answer is not to suppress wage growth,” he told the hearing. “The answer is to make wage growth sustainable.”