THE Department of Labor and Employment on Monday said only Congress can grant an across-the-board daily wage increase of P125 nationwide but the government has already set aside an initial P200 million for workers who will be displaced by the termination of contractualization schemes.
Labor Secretary Silvestre Bello III said Republic Act 6727, or the Wage Rationalization Act, only limits DoLE to “adjusting the wages of our workers but an across-the-board wage increase is not within our mandate.”
“It is under the jurisdiction of Congress. It has to go through a legislative act,” Bello said, adding that all Regional Tripartite Wages and Productivity Boards are mandated to review wage hike proposals with public consultations in their respective jurisdictions.
“Different regions have different socio-economic conditions and cost of living conditions. We have to consider these conditions,” he said.
The Labor chief also said any increase in wages will have implications on the cost of doing business, production, employment and prices.
“The Regional Wage Boards will continue with their reviews and consultations on the salary adjustments at the regional level. They are conducting periodic assessment of their respective regions. They will be the ones to submit their recommendations if there is a need to increase the wage in their region,” he said.
Bello also cited the simulation study made by the National Economic and Development Authority on the impact of the proposed P125 wage increase.
According to the study, the proposal could result in upward pressures on prices from 2017 to 2018, the strongest of which could be felt in 2017, when inflation could rise to 9.7 percent from a baseline of 2.1 percent.
But the government has set aside an initial P200 million for workers who will be displaced by the termination of contractualization scheme, Bello added.
The amount will provide for livelihood assistance and skills training for thousands of workers who would be affected by the government’s campaign against the illegal contractualization practices.
“As we intensify the campaign to end illegal contractualization thus putting an end to endo, the government is prepared to help our workers who will be displaced in the process,” Bello said.
About 250,000 workers are employed under the “endo” scheme that circumvents the law mandating employers to regularize workers.
Bello said the labor department will provide affected workers with livelihood assistance so that they could have alternative source of income, while skills training will be given to those who would want to upgrade their competencies for other jobs.
He said the government has readied a package of services that will enable the target beneficiaries to start a livelihood enterprise and become self-employed.
“The livelihood assistance is aimed at helping the displaced worker to have a sustainable self-employment through easy to learn livelihood undertakings,” Bello said.
He also said that DoLE will also provide workers who will avail of the livelihood assistance with trainings on business management, entrepreneurship and production skills to help them manage their business. The skills training, on the other hand, will be provided by the Technical Education and Skills Development Authority.
“Tesda has a menu of short courses which the displaced workers can avail of. Skills upgrading can help them look for other income sources,” Bello added.