INCREASING the minimum wage for workers would not bankrupt all businesses in the region, according to an official from the Trade Union Congress of the Philippines (TUCP).
Luis C. Corral, vice president of TUCP and Associated Labor Unions (ALU), explained to SunStar Davao on July 29, 2024, at the Bai Hotel Cebu, Mandaue City, that studies indicate only 10 percent of companies' profits would be affected by a wage increase.
Corral emphasized that the argument that wage increases will cause companies to close or pass the added costs to consumers has been heard for a long time and is not supported by studies.
Corral said according to research he has gathered, the proposed P150 wage increase is minimal and manageable for businesses.
He added that companies unable to increase wages can apply to the Regional Wage Board for an exemption, with 84 percent of such applications being granted due to financial distress.
Additionally, businesses with fewer than 10 employees are automatically exempt from minimum wage orders under the Barangay Enterprise Act.
Corral stressed that most business closures are due to uncompetitiveness rather than wage increases.
The TUCP has called on the House of Representatives to pass House Bill 7871, the Wage Recovery Act of 2023, proposing a nationwide P150 daily wage increase for private sector workers.
The Senate recently approved Senate Bill 2534, proposing a P100 daily minimum wage increase for private sector employees.
The last legally mandated wage increase in the Philippines was Republic Act 6727, the Wage Rationalization Act, passed in 1989.
The Davao Region was the last to adopt the minimum wage adjustment, with the Regional Tripartite Wages and Productivity Boards-Davao Region (RTWPB-Davao) approving a P38 increase for minimum wage earners and domestic workers. The first tranche took effect on March 6, 2024, with the second tranche scheduled for September 1. RGP