Employers oppose P125 daily wage hike

Two groups of businessmen warned yesterday of massive company shutdowns and displacement of workers if Congress raises the daily minimum wage by P125.

The Employers Confederation of the Philippines (ECOP) and the Philippine Chamber of Commerce and Industry (PCCI) said it would be "unwise" for Congress to legislate a wage increase at this time.

ECOP president Rene Soriano said the bill’s passage into law could force foreign investors to leave and transfer their business elsewhere in Asia.

"It is not advisable to enact into law the proposed P125 wage increase because it could force many commercial establishments, particularly small and medium enterprises (SMEs), to fold up or go underground," he said.

Soriano said workers must consider that employers, just like them, have also been affected by the implementation of the expanded value added tax (EVAT) law.

"Employers are also adversely affected by EVAT because of the additional costs in power and materials for production," he said. "Since cost of labor is one of the factors of production, the mandated wage increase would make it cost more to produce the same quantity of output and thus lead to astronomical increase in prices of commodities."

On the other hand, Donald Dee, PCCI president, said it is too early to discuss a salary increase, including a legislated wage hike since the people are yet to feel the actual impact of the EVAT.

Militant labor groups have long been demanding a P125 wage increase, but they have already received more than that amount from the pay hikes granted by the different wage boards, he added.

Meanwhile, the moderate Trade Union Congress of the Philippines (TUCP) welcomed Malacañang’s support for a legislated wage increase but warned that a P125 raise in the daily minimum wage would "do more harm than good" for the workers.

"While we appreciate efforts to improve working conditions, we should exercise caution in making proposals not only to protect industries and businesses but more importantly to ensure the viability of jobs," the TUCP, the countrys largest labor group, said in a statement.

The TUCP said it would prefer at least a P70 increase in the daily salary of workers, and tax exemption for minimum wage earners and other low-salaried workers nationwide.

At the House of Representatives, two party-list lawmakers urged President Arroyo yesterday to certify as urgent a bill seeking to grant workers a P125 across-the-board salary increase.

Bayan Muna Rep. Teddy Casiño said a presidential certification will hasten passage of the bill, which has been "languishing" in the House plenary since April.

"The absence of a certification from Malacañang declaring the bill as urgent will prove that the (Palace’s) statement (of support for the bill) is nothing but a praise release," he said.

Anakpawis Rep. Crispin Beltran, one of the bill’s authors, said a legislated wage hike was only raised by the government to "shield" it from the people’s wrath and "pacify public outrage" brought about by the latest price increases.

"Naghahanap lamang ang Malacañang ng kakampi para sa EVAT dahil talagang marami ang galit dito (Malacañang is looking for allies because the EVAT has angered many)," he said.

On the other hand, the left-leaning Kilusang Mayo Uno (KMU) said it is actually willing to accept a wage hike lower than the P125 increase sought by Congress, depending on the impact of EVAT on the workers’ purchasing power.

"We could go lower than P125 if the monitoring would show that EVAT is minimal or we could go higher depending on the effect," KMU chairman Elmer Labog said as he called on the government to grant immediate wage relief for workers.

Malacañang should not use the proposed salary hike as "smoke screen" for the country’s political and economic crises, Labog added.

Various labor groups are demanding the immediate passage of a law granting a P125 across-the-board increase in the daily minimum wage to help of workers cope with the economic effects of EVAT.

Meanwhile, senators have expressed different opinions on Malacañang’s proposal for Congress to legislate an increase in the daily minimum wage.

Senate Minority Leader Aquilino Pimentel Jr. said the wage hike should be left for labor unions to negotiate and regional wage boards to decide.

On the other hand, Sen. Jinggoy Estrada, chairman of the Senate committee on labor, employment and human resource development, said he has always been in favor of a legislated wage hike.

"Nu’ng araw pa (Ever since), I’ve always been in favor of a legislated wage increase," he said.

"Dapat considering na yung panahon ngayon ay di masyadong maganda ang ating ekonomiya, pinag-aralan na namin iyan. Dapat talaga through legislation ang wage increase (Considering that our economy is not doing well, we are studying it. A wage increase should be done through legislation)," he said.

Estrada said there is a need to seriously study a bill seeking to grant a P 125-across-the-board increase in the daily minimum wage now pending before the House.

"I don’t know sa House kung ipapasa na ang P125…kung ipapasa nila iyon, saka ako magko-committee hearing... P125 is quite big, baka di kayanin ng mga kapitalista (I don’t know if the House will pass the 125...if they will pass it then I will hold a committee hearing... 125 is quite big, the capitalists might not be able to afford it)," he said.

However, Sen. Serge Osmeña III expressed doubt about Malacañang’s proposal.

"Is there anybody left who believes whatever the Palace says?" he asked.

" (It is) another gimmick to allay the people’s anger. That’s just a gimmick to deflect the anger of the people. Better if she resigns."

Meanwhile, Sen. Richard Gordon, who has been distancing himself from the administration, accused President Arroyo of "trying to pass on the problem to the legislature."

"There are many things that wages do, apart from enriching those with wages," he said. "It also affects those without work."

The Philippines should follow the example of China, South Korea and Japan which require low salaries until they are able to determine higher value for wages.

"Sa akin (For me), it is important that the wage increases be decided by wage boards," he said.

"They are closer on the ground... while legislature can do that, cast wages in stone... di mo alam kung magiging elastic na naman... baka masyadong mataas na di na pumasok ang negosyo (You don’t know if it will become elastic again...it might be too high that business would not come in)," Gordon said.

Gordon also advised Mrs. Arroyo against pushing for a legislated wage hike.

"The President must not pass on to the legislature what is essentially an executive function," he said. "It should really be the executive that should make decisions... whether it would be good for the wage earner."

However, Sen. Panfilo Lacson welcomed the Palace’s statements that it is ready to support a legislated wage hike to resolve rising prices of fuel and basic commodities.

"We want to see her certify the bill in the House and Senate as urgent," he said.

"If she does not, then it’s only lip service, passing the burden to

Congress. Kailangan sundan niya ng (She should follow it up with a) certification."

Lacson said he has set a hearing on the wage hike next week when the Senate resumes regular session.

"That should go hand in hand with workers in the private sector," he said.

Lacson said it is not easy to legislate a wage hike.

"Either you please the workers and displease business, or the other way around," he said. "Inalis niya sa kanya ang burden dahil sa EVAT (She has taken the burden off herself because of the EVAT)."— With reports from Delon Porcalla, Christina Mendez