Minimum wage now higher than poverty threshold

MANILA, Philippines - Most workers nationwide are now better off and are earning more to address their basic needs.

The Department of Labor and Employment (DOLE) reported yesterday that most minimum wage rates in the country’s different regions are above the “poverty threshold.”

DOLE Secretary Rosalinda Baldoz said from the 37 minimum wage rates below the poverty threshold in 2011, the number is down to 19.

“Since the different regional tripartite wages and productivity boards (RTWPBs) started implementing in 2012 the two-tiered wage system, there have been gradual upward adjustments in those minimum wages that lag behind the poverty threshold to levels higher than the threshold,” Baldoz said.

Poverty threshold is defined as the minimum earnings or expenditure required for a family or individual to meet food and other basic requirements.

Baldoz said the country’s 16 RTWPBs have completed their transition plans to the two-tiered wage system, which consists of a mandatory minimum wage to protect the poor and vulnerable workers and a voluntary productivity-based incentive scheme over and above the minimum wage.

She said part of the transition plan is for the wage boards to issue industry-specific advisories to guide enterprises and workers in adopting productivity incentive schemes and gain-sharing programs.

She added that the wage boards in the Cordillera Administrative Region (CAR) and Calabarzon have issued advisories on the adoption of productivity incentive schemes.

“The rest of the boards have identified priority or growth sectors for which advisories will be correspondingly issued in the next one to two years,” she said.

The two-tiered wage system provides that the minimum wage shall be set above the poverty threshold to help workers meet basic needs and reduce poverty, Baldoz said.

But she stressed that minimum wages must not exceed the average wage in order to broaden the space for bipartite approaches to setting the terms and conditions of employment.