Philippines hikes compensation for minimum wage earners

Small businesses hurt by the pandemic may file for exemption

Philippines hikes compensation for minimum wage earners

The Philippine Department of Labour and Employment (DOLE) announced this week an increase in minimum wages for workers in Metro Manila and various regions. 

It comes after their respective Regional Tripartite Wages and Productivity Boards issued separate Wage Orders directing the increase.

National Capital Region

In the National Capital Region (NCR), the new minimum wage for non-agriculture workers will be P570, while it will be hiked to P533 for employees in the agriculture sector.

It is expected to benefit about one million minimum wage earners working for private businesses in the NCR. It will take effect starting June 4, according to DOLE.

This is the first time since November 2018 that the minimum wage has been increased in the NCR. It took in consideration the escalating prices of basic goods, commodities, as well as petroleum products.

Western Visayas

Meanwhile, the Regional Tripartite Wages and Productivity Board of Western Visayas increased the minimum wage there to PhP450 for employers with more than 10 workers in the non-agriculture, industrial and commercial establishments.

For those with 10 and less workers, salary for employees has been increased to P420.

The board also raised the daily minimum wage of workers in the agricultural sector to P410, while also increasing the monthly minimum wage rate for domestic workers to P4,500.

The wage hike will take effect on June 5, according to DOLE, and will benefit around 214,000 minimum wage earners and over 160,000 domestic workers in the region. Similarly, the board also cited in the wage hike the rising prices of basic goods, commodities, and petroleum products.

This will be the first time since November 2019 that wages were increased for workers in the private establishments, while this is also the first time since May 2019 that wages were hiked for domestic workers in Western Visayas.

Ilocos Region

In a separate announcement, DOLE also said the minimum wage in the Ilocos Region will be increased to a range of P372 to P400. Domestic workers in the region will also be receiving a new monthly wage rate of P5,000.

Cagayan Region

For the Cagayan Region, its Regional Tripartite Wages and Productivity Board approved a minimum wage rate range from P400 to P420. This is a P50 to P75 increase from the previous P345 to P370 in the board's previous wage order.

Read more: Philippines grants night shift workers differential pay

Caraga Region

In Caraga, the Regional Tripartite Wages and Productivity Board has issued a new Wage order raising the new daily minimum to P350. It will take effect for private establishments in Butuan City and the provinces of Agusan del Norte, Agusan del Sur, and Surigao del Sur.

However, DOLE said the effectivity will be later for the provinces of Dinagat Islands and Surigao del Norte, including Siargao Islands, which will take effect on September 1.

The effect of the wage order usually comes 15 days after publication in a newspaper of regional circulation, according to DOLE.

In a statement, DOLE Secretary Silvestre Bello III thanked the wage boards for heeding his call to speed up the review of increasing the minimum wages.

"Let me cite the good job done by the NCR and Region VI (Western Visayas) wage boards for taking the extra mile in resolving with dispatch the petitions for wage adjustments in their jurisdictions," he said.

"Following the lead of the NCR and Western Visayas, I expect the other regional wage boards to issue their respective wage orders in the coming days and week," he added. "I am confident we can overcome the odds in wage-setting if only to help ease the living condition of our minimum wage earners."

Exemption from the wage order

In a follow-up statement, the Labour Department said that micro-businesses may apply for exemption from the wage hikes if they are:

  1. Regularly employing not more than 10 workers
  2. Affected by natural calamities and/or human-induced disasters, including the pandemic

According to DOLE, the exemption will "temper" the impact of the wage increase to the operations of these businesses.

"The exemption will also provide a breathing space for micro, small, and medium enterprises (MSMEs) that suffered from the pandemic to resume their business operations and to fully recover," said DOLE in a statement.

Application for exemption may be filed to their respective Regional Tripartite Wages and Productivity Boards, according to DOLE.

Exemption will be valid for one year, and businesses granted it may pay their employees based on the rates stipulated by the previous Wage Order.

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