Minimum wage rates remain frozen due to fear of more retrenchment

BY SAMUEL P. MEDENILLA, 10 Sep 2021

The construction industry, which accounts for some 4.2 million workers, is normalizing slowly amid renewed caution over a possible variant-driven spike in Covid-19 cases. Construction industry players said they would rather focus on preventing the spread of the virus in the workplace. In photo, workers are busy rushing a condominium project along Katipunan Avenue in Quezon City.

Minimum wage rates nationwide have been frozen for over a year now as the pandemic continues to disrupt business operations and displace thousands of workers, according to the National Wages and Productivity Commission (NWPC).

During the budget hearing of the Department of Labor and Employment (DOLE) last Thursday, NWPC Executive Director Ma. Criselda R. Sy disclosed the last wage order passed by the regional wage boards was last year, which raised the minimum wage rate in Region 2 by P10.

However, since the onset of lockdowns in response to the novel coronavirus disease (Covid-19) crisis, Sy said, RTWPBs deferred issuing wage orders.

“All wage orders issued by our 16 Regional Tripartite Wages and Productivity Board (RTWPB) have now passed their anniversary dates by a range of 5 months to 27 months. That is for the minimum wage for the private sector,” Sy said.

She noted the minimum wage rate for household services workers (HSW) also stagnated for over a year.

“With regard to the minimum wage of domestic workers, all wage orders are now past their anniversary dates from a range of 5 months to 38 months,” Sy said.

Despite the eroded value of existing minimum wage rates, the RTWPBs are wary of raising the minimum wage rate now since it could lead to mass retrenchment of vulnerable workers.

She noted since most companies are still unable to operate at 100 percent capacity due to the movement restrictions related to the pandemic, firms will be unable to afford to increase pay of their workers.

“In such a case, they will normally retrench the unskilled and then retain the skilled,” Sy said.

Bayan Muna party-list Rep. Ferdinand Gaite said he understands the plight of many business, particularly of micro, small, and medium enterprises (MSME),

To help MSMEs afford a possible pay hike for their workers, Gaite reiterated his appeal for Congress to pass legislation granting age subsidies to Covid-affected workers.