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By Raynan F. Javil

TUCP to seek P157 hike in daily minimum wage

Posted on April 26, 2017

THE COUNTRY’s biggest labor union has asked President Rodrigo R. Duterte for a P500 subsidy for each private sector minimum wage earner and is poised to file for a P157 raise in the daily floor pay.

A new round of minimum wage hike petitions is about to begin. -- BW FILE PHOTO
The proposals, however, promptly encountered opposition from the Budget department and private sector employers.

These will add to the current daily minimum wage, which in Metro Manila -- whose rates set the bar for the country’s 17 other regions -- amounts to P454 for agriculture as well as small manufacturing, retail and other service establishments, and to P491 for other non-agriculture businesses, including private hospitals with up to 100-bed capacity.

These rates in Metro Manila took effect on June 2 last year, and the National Wages and Productivity Commission is constrained by law from making new adjustments within a year of the last wage order in each of the country’s 18 regions.

The Associated Labor Unions-Trade Union Congress of the Philippines (ALU-TUCP) has submitted a proposal to Malacañang for the establishment of a conditional cash transfer program for the country’s minimum wage earners which it called Labor Empowerment and Assistance Program (LEAP).

The group’s letter to the palace, a copy of which was distributed in a press briefing yesterday, states that the proposed LEAP “takes the form of an emergency subsidy in the amount of a P500 monthly cash voucher intended to provide the working poor food or grocery items.”

Luis J. Coral, national vice-president of the ALU-TUCP, said his group wants the subsidy in place until at least 2022.

“We are hoping for [the subsidy to be given during] the life of the Duterte administration, but if you want to extend it kailangan natin ng batas (a law is needed),” he said in a press conference in Quezon City yesterday.

Mr. Coral said that in order to qualify for the proposed LEAP, a minimum wage earner should have been in the records of the Social Security System (SSS) at least for the past six months. “Kailangan six months nag-bayad ka... sa SSS. So, hindi ka pwedeng susulpot na lang at sasabihing minimum wage earner ka. Kailangan may six months ka na record dun under sa bracket ng minimum wage earners sa SSS (You have at least paid your contribution to the SSS for the last six months. You can’t just show up and say you are a minimum wage earner. You need to have at least a six-month record with the SSS that shows you are in the minimum wage earner bracket),” said Mr. Coral.

Asked on funding, Mr. Coral said that the budget of the Office of the President can first be tapped in the absence of a legislated law. Then, funds can be included in the national budget.

Napakalaki ng budget ng social fund ng presidente, napakalaki ng kanyang discretionary funds na puwedeng pagkuhanan niyan (The President has a huge social fund, he has huge discretionary funds which can be the source of the subsidy),” Mr. Coral said.

The General Appropriations Act gave the Office of the President a P20.03-billion budget for this year, a sevenfold increase from the P2.86 billion earmarked for 2016.

Mr. Coral said that the President can order the Department of Labor and Employment (DoLE) to implement the proposed subsidy program.

“Without legislation, he can already direct the Department of Labor [and Employment]. They can use National Wage and Productivity Commission as the basis to provide something like that. So the DoLE can still administer the LEAP in coordination with the SSS and trade unions,” he said.

ALU-TUCP spokesperson Alan A. Tanjusay said in the same briefing that the group will also ask next week for a P157 increase for Metro Manila’s private sector minimum wage earners, saying that the actual value of the current P491 floor pay “fell to P361.30 in January 2017.”

“There has been no inclusive growth for minimum wage earners because the power of minimum wage is going downward amid rising prices of basic necessities and cost of services,” said Mr. Tanjusay.

Mr. Tanjusay explained that because “they have no savings and inadequate government support programs, minimum wage workers are so vulnerable that if they get sick, if they get late or absent from their work, or any small price shocks, they fall deeper and deeper into poverty.”

Asked for date of filing with Metro Manila’s wage board, Mr. Tanjusay replied: “Our target is after May 1.”

In a separate statement, Michael C. Mendoza, national president of the ALU-TUCP, said that this is the “first time” that the labor group is asking for cash subsidy on top of a wage increase.

“For the first time in the history of TUCP, we are asking in one time a cash subsidy from government and a wage increase from employers and capitalists to help workers cope with poverty,” Mr. Mendoza said.

DoLE Undersecretary Joel B. Maglungsod -- whom Mr. Duterte had appointed to government from the ranks of the left-wing Kilusang Mayo Uno (May 1st Movement) -- said he was aware of ALU-TUCP’s petition but that department officials have not discussed it.

May pinadala na silang sulat sa Malacañang... Hindi naman namin pwedeng panghimasukan ‘yung Office of the President. Pag-aaralan na ng Malacañang ‘yan kung balido ‘yun (They sent a letter to Malacañang... we cannot interfere with the Office of the President. Malacañang will study if their petition is valid),” Mr. Maglungsod said in a text message.

Alam naman ng presidente ang pangangailangan ng ating manggagawa, kasi ang puso niya ay para sa manggagawa naman talaga eh. (The president knows what the country’s workers need because his heart is truly with them.)”

The wisdom of the proposals, however, was promptly questioned.

Sought for comment, Laura B. Pascua, undersecretary of the Department of Budget and Management for Budget Policy and Strategy, said in a mobile phone message that any increment in daily minimum pay is best left for regional wage boards to decide in order “to handle this sort of request in a more sustainable manner.”

The wage board system is designed to customize daily minimum wage to conditions unique to each of the country’s 18 regions.

Ms. Pascua noted further that the government is already pushing for a reduction in personal income tax rates as a core provision of its first tax reform package now awaiting approval in the House of Representatives.

Moreover, she cautioned that “[g]iving further subsidy to those who are already employed will only further exacerbate the unemployment problem of the country”.

Many economists have warned that granting a pay raise across-the-board -- outside the regional wage board system -- will cause the general increase in prices of widely used goods and services to spin out of control, in turn forcing businesses to lay off workers in an effort to cut costs just to survive.

Sought for comment, Employers Confederation of the Philippines President Donald G. Dee reiterated his group’s support for the regional wage-setting framework.

“You know, every year they (labor groups) do that... But for us, we will look at the environment, we look at the consumer price index, basic commodities, we look at the inflation, all of these and then we will make our position,” Mr. Dee said in a texted reply to questions yesterday.

“People always ask if we can afford. You know, just look at our competitiveness and you will find that we are the only country in Southeast Asia lagging behind, especially in manufacturing,” he added.

“So that says a lot that our cost is higher than others, aside from other reasons of course.”