The Department of Labor and Employment approved 10 new wage orders in 2014, granting increases ranging from one peso to P20 in the form of either basic pay or cost of living allowance (COLA).
The Regional Tripartite Wage and Productivity Boards (RTWPBs) which issued wage orders in 2014 are those in the Cordillera Administrative Region, Regions 1, 2, 3, 4-A, 5, 7, 11, 12, and the Autonomous Region of Muslim Mindanao.
The minimum wage workers in the private sector in Metro Manila received their pay increase in 2013.
The rest of the RTWPBs are in various stages of assessing the socio-economic conditions and holding sectoral consultations as basis of their decision to adjust minimum wages.
Badoz said that of the 17 regional wage boards, eight have brought all their minimum wages to amounts higher than their region’s poverty income threshold, in compliance with the wage reform called the Two-Tiered Wage System (TTWS).
The reform consists of a genuine floor wage as Tier 1, which is set above the poverty income threshold to help workers and families meet their basic needs and to contribute to poverty reduction, but not to exceed average wage to allow bipartite approaches, such as collective bargaining, in setting better terms and conditions of employment.
As the regional wage boards transition to the Two-Tiered Wage System, there have been simplifications in the minimum wage structures which, in turn, are expected to facilitate administration and enforcement.
“With the adoption of the two-tiered wage system, it is expected that all minimum wages shall be above the regional poverty income threshold by end of 2016,” Baldoz said.
The second part of the TTWS reform aims to encourage workers and enterprises to mutually agree to adopt productivity incentive schemes as sustainable source of higher revenues for enterprises and higher real incomes for workers over and above the mandatory minimum wage. The regional wage boards issue advisories to guide enterprises who will voluntarily adopt productivity improvement programs and gain-sharing schemes.
Baldoz said 15 RTWPBs already issued advisories on the implementation of productivity incentive schemes for industries like tourism, transportation and storage, manufacturing, mining, canning (sardines), banana, plantation for selected crops, higher education institutions and hotels and restaurants.
The advisories contain an assessment of an industry’s performance and outlook for the coming year and, on this basis, recommend a percentage range of productivity based wage increases.
In addition to the issuance of advisories, Baldoz said the RTWPBs are also currently organizing orientations and providing technical assistance in the form of training and consulting to establishments that have decided to implement productivity incentive schemes in their workplaces.
