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Thursday, February 27, 2025
26.9 C
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Thursday, February 27, 2025

‘Wage hike a balancing act’

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Marcos says both workers, small businesses must be protected

President Ferdinand Marcos Jr. said the government must strike a balance between increasing the purchasing power of workers amid inflationary pressures and protecting small businesses that will be affected by the proposed P200 daily wage increase.

“We will try to resolve this because as you know it’s very clear that prices of goods are still rising. Inflation is still here. We haven’t been able to curb it completely,” he said.

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“(But) there are also many sides to this question. Employers are worried, especially the small employers, for example, sari-sari stores, parlors, beauty parlors, and the like, the smaller ones. If the minimum wage is increased, they will have to reduce their employees because their money will still be the same. They will not have more money to pay salaries,” the President added.

The Bangko Sentral ng Pilipinas on Friday said inflation for January 2025 is projected to be between 2.5 and 3.3 percent, well within the government’s target of 2 percent to 4 percent. 

“Upward price pressures in January stem from the rise in petroleum prices, increased prices of major food items owing to the lingering effects of recent weather disturbances, as well as the annual adjustments in water rates and sin taxes,” the BSP said. 

Inflation rose to 2.9 percent in December, higher than the 2.5 percent recorded in November, due mainly to higher prices of housing and energy.

President Marcos likewise emphasized that the government’s tripartite wage board is responsible for determining wage adjustments and must be considered in the discussion.

“We still have to study it further to see how these (wage board and legislated wage hike) will work together,” he said.

“The tripartite body was [the] creation of Congress. They were the ones who formed it, wrote the law and established that kind of entity. That was their job to determine what should be the minimum wage,” Mr. Marcos added.

Mr. Marcos said the wage hike bill, recently approved by the House Committee on Labor, requires further study due to its potential economic impact, particularly on MSMEs.

“There’s no problem with corporates — those big corporations, they can handle it. No matter what increase you put on them, they can handle it. But the small ones, that’s what others are worried about,” Mr. Marcos said.

“But I think there is a way to increase that but we have to resolve the legal issues, we have to resolve the economic issues. So, it still deserves a great deal of study,” the President said.

Senator Joel Villanueva, chairman of the Senate Committee on Labor, Employment, and Human Resource Development, on Friday expressed hoped that Mr. Marcos will certify the wage hike bill as urgent, adding that economic growth must translate into tangible benefits for the workforce.

The chairperson of the House labor panel, for his part, urged Filipinos to stand united in pushing for the immediate passage of the measure.

“The wage hike bill is a much-needed measure that could bring relief to millions of minimum wage workers across the whole country” Rizal  Rep. Fidel Nograles said.

The rise in inflation in December underlines the urgency of the legislated wage hike to help Filipino families to cope with the higher cost of living, Nograles added.

Moving forward, the BSP said the Monetary Board will continue to take a measured approach in ensuring price stability conducive to balanced and sustainable growth of the economy and employment.

The Monetary Board is scheduled to hold its first meeting for the year on February 13. The House panel approval came after Speaker Martin Romualdez initiated a meeting Tuesday night with labor groups to discuss their call for higher wages.

The P200 daily wage increase put forward in the House is higher than the P100 daily wage hike approved by the Senate way back in March 2024.

Senate President Francis Escudero said the Upper Chamber will work with the House toward the passage of an across-the-board daily wage hike for private sector workers.

Employers Confederation of the Philippines president Sergio Ortiz-Luis Jr., however, warned that legislating wage hike would be counterproductive.

“It sounds good but in reality, it will just benefit a few,” Ortiz-Luis said.

Under the proposed law, employers must provide an additional P200 per day to their workers’ salaries upon effectivity.

The legislation prohibits employers from offsetting the increase with previously granted wage adjustments unless these were explicitly anticipated under collective bargaining agreements. Existing benefits and allowances cannot be reduced as a result of the pay hike.

Editor’s Note: This is an updated article. Originally posted with the headline “Marcos: Proposed P200 wage hike needs ‘further study’.”

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