EDITORIAL - Politicizing wage-fixing

Happy workers generally lead to better productivity. And the happiness typically starts with proper compensation.

Employers and entrepreneurs who have succeeded in their businesses know the importance of promoting their employees’ welfare not just in terms of compensation but in all aspects of the working environment. The success of a business depends heavily on the quality of the workforce.

Sustainability is a key consideration. A successful business means more jobs created and greater capacity to provide better pay. A troubled bottom line can lead to layoffs, pay cuts or even the shutdown of the business.

Obviously, the needs of both workers and employers are not always in sync. This is best resolved through negotiation, with the government serving as arbiter. Circumstances are unique across industries and can vary across regions, depending on the cost of living.

By law, the mechanism for determining wages is through the tripartite regional wages and productivity boards, which take into consideration both the needs of workers and the capacity of employers to comply with a wage increase.

Now the 19th Congress, after mangling the 2025 national budget in hopes of using billions in people’s money for personal or partisan purposes during the elections, wants to redeem itself by politicizing wage fixing. Unwilling to carry out their constitutional mandate of trying an impeachment case, senators might yet find time to work with the House in stampeding President Marcos into approving a legislated P200 daily across-the-board wage hike.

That’s about P4,400 a month for a five-day workweek in additional pay. Business groups have expressed concern about the capacity to comply with this legislation, considering that over 90 percent of enterprises in the country are small operations.

The groups have warned that the increase could stoke inflation, result in layoffs and business shutdowns, and dampen new investments. They point out that neighboring countries are focusing on drawing investments and stimulating economic enterprises to create more jobs with decent pay.

No one will argue with the need for a living wage for the country’s workforce. But preserving and creating more jobs should not be set aside. If wage fixing is left in the hands of politicians, there’s no stopping them from legislating wages up to the stratosphere in the name of populism.

With just days to go before the Congress ends its regular session, this hot potato may be tossed into the lap of President Marcos. If the warnings of the business community about the perils of politicizing wage fixing come true, it will be the President who will be left holding the bag.