MANILA, Philippines – The business community yesterday cautioned the Regional Tripartite Wages and Productivity Boards (RTWPBs) nationwide against the granting of excessive salary increases.
Employers Confederation of the Philippines (ECOP) president Sergio Ortiz-Luis Jr. said any wage adjustment to be granted by the board should merely restore the erosion in wage resulting from increase in consumer price index (CPI).
He pointed out that any increase higher than the CPI would be hazardous to business companies, particularly the small and medium enterprises that comprised over 90 percent of firms in the country.
“We in ECOP are not socially irresponsible and heartless as to deny the needs of workers but the various wage boards should seriously deal with the practice of non productivity-based increases and its adverse effects on inflation, employment and viability of micro and small establishments,” Ortiz-Luis pointed out.
According to Ortiz-Luis, wages constitute a significant factor that determines the viability and competitiveness of an enterprise.
Based on records, Ortiz-Luis said, the number of workers in the formal sector shrank since the Asian financial crisis in 1999 until 2006 while those from the informal sector continued to expand.
“As of 2006, the number of establishments lost was 43,704 while employment decreased by 1,028,805. On the other hand, the informal sector expanded by 4,795,015,” he said.
Thus, Ortiz-Luis said the wage boards should not lose sight of the plight of micro and small and medium enterprises in the ongoing wage hike deliberations.
“Every time wages are increased, which, are invariably not productivity-based, SMEs suffer from the immediate and adverse effects of such wage increases,” he added.
Earlier, employers pushed for the granting of not higher than P15 salary increases and emergency cost of living allowance (ECOLA) to help workers cope with the rising cost of essential commodities.
Aida Andres, Regional Tripartite Wages and Productivity Board (RTWPB) in the National Capital Region (NCR), said the wage boards agreed on giving salary hikes but are actually divided on the amount and form.
Various labor unions nationwide are seeking wage hikes ranging from P80 to P150. Workers also warned the wage boards against the granting of measly adjustments
But labor officials maintained that the wage boards would take into consideration the capability of the employers and need of workers for a pay hike in rendering a new wage order.
Teachers covered
Public school teachers and other government employees will be covered by the proposed higher tax exemptions for salaried workers, Antique Rep. Exequiel Javier, House ways and means committee chairman, said yesterday.
“All employees receiving salaries, whether in the government or private sector, will be covered. Teachers are definitely included,” he said.
Some state workers’ groups have earlier expressed apprehension that they might not be benefited by the planned higher tax exemptions.
On the eve of Labor Day, May 1, the House of Representatives tried but failed to pass a bill doubling the tax exemptions not only of minimum wage earners but all other workers as well.
The bigger exemptions, which would spare those receiving minimum pay from income tax, are contained in Bill 3971.
House officials led by Speaker Prospero Nograles have earlier assured workers that their chamber would approve the proposed bigger exemptions before Labor Day.
The exemptions are intended to augment whatever amount of salary increase that regional wage boards would give minimum wage earners.
Under Bill 3971, the personal tax exemption of a working married individual would be increased from P32,000 to P50,000, while the exemption for a dependent would be adjusted from P8,000 to P25,000. A maximum of four dependents would be allowed. — Mayen Jaymalin, Jess Diaz