BUSINESS leaders in Cebu strongly oppose the bill that seeks to increase the minimum wage to P750 nationwide, saying this would be destructive to business and hamper the growth of small and medium enterprises (SME), especially in the countryside.
The Makabayan bloc on Monday filed House Bill 7787 for a nationwide minimum wage of P750, citing inflationary effects of the government’s tax reform program.
Regional Tripartite Wages and Productivity Board (RTWPB) 7 member Philip Tan said the bill is not feasible as the economy cannot absorb the proposed wage rate.
He also cited differences in living costs in different areas that make the bill not economically viable.
“They must be talking to the moon. The rights of labor are equally given to management. If we lose money, time to say goodbye. No hard feelings,” said Tan.
He argued that the inflationary impact of the government’s tax reform program shouldn’t be shouldered by businesses, as they, too, are affected by high costs.
“We, too, are hit by inflation. Ngano kami man ang mo-shoulder ani? These are scenarios nga dili kami ang naka-ingon ani (Why must we shoulder the burden? We are not to blame for this),” said Tan.
“I don’t think the minimum wage should be increased but I do believe there should be productivity bonuses for workers that excel. If we further increase the cost of doing business in the Philippines, we will once again revert to being a third-class investment destination,” said Cebu Business Club president Gordon Alan Joseph.
“The government can control inflation, which is currently spiraling because of their tax policies. Business is suffering. It’s time for government to offer the solution instead of burdening the private sector with wage increases,” Joseph added.
HB 7787 also proposes to abolish the National Wages Productivity Commission (NWPC) and the Regional Tripartite Wages and Productivity Boards (RTWPB) and repeal Articles 121, 122, and 123 of the Labor Code.
The bill also provides measures against downsizing and what it deemed other unfair labor practices.
Minimum wage in Metro Manila stands at P520. Minimum wage in Cebu currently stands at P366 a day or at least P10,000 a month.
Should the bill be approved in Congress, Steven Yu, vice president of the Mandaue Chamber of Commerce and Industry (MCCI), warned this could hurt the development of SMEs, especially those outside Metro Manila.
“You can’t apply a national minimum wage because the level of economic activities is different in each area. The cost of living and doing business is different,” he said. “They are susceptible to any increases in cost. This (bill) would be destructive to the business community,” he added.
Yu noted entrepreneurs are now experiencing high cost of doing business due to external factors like high prices of oil and a weakening peso, which drive prices and interest rates up.
“For Central Visayas, that proposed national wage is too high,” he said.
“We are not against any increase, but any increase should be reasonable,” said Yu, adding that workers, employers and the government must arrive at a “win-win” solution for the country to remain competitive amid internal and external pressures.
“Passing such a bill would also affect our competitiveness stance against our competing neighbors in Asean,” said Yu.
Last week, members of the RTWPB 7 were unanimous that wages should be adjusted. They’ll decide by how much in their next meeting on June 7.
President Rodrigo also signed recently Republic Act 11032 or the Ease of Doing Business Act of 2018 in an effort to correct bureaucratic red tape that continues to hound government institutions.