The Employers Confederation of the Philippines (ECOP), joining calls for the exemption of micro enterprises (MEs) from the increase in minimum wage, expressed concern over the impact of such adjustment to the government’s job creation efforts.
Sergio Ortiz-Luis, ECOP president, said half of MEs have been shut down by the pandemic and have yet to reopen due to the uncertainties.
“With the additional expenses, these micro enterprises may no longer reopen and those which are planning to expand may no longer pursue their plans,” Ortiz-Luis said.
The National Productivity and Wages Commission said the wage order exempts barangay micro-enterprise businesses (BMBEs), or those with total assets of not more than P3 million.
The regional wage boards in the National Capital Region and Region 6 (Western Visayas) recently issued orders increasing the daily minimum wage of workers in the private sector.
“We had wanted to exempt MEs (from the wage adjustment) although these aren’t members of ECOP. Ninety percent of industries are MEs and 65 percent of workers come from MEs. We will see how we can do that exemption,” he added.
Ortiz-Luis said while ECOP has always pushed collective bargaining agreements as a platform for wage hike discussions, there are only few companies now which have organized labor and workers get higher adjustments through the wage boards.
“The additional P33 (increase in daily wage in the National Capital Region) is P900 monthly; if you count the adjustment in the computation of the benefits and overtime, that could run up to P1,300 per month which some MEs cannot afford,” Ortiz-Luis added.
Presidential Adviser for Entrepreneurship Joey Concepcion on Sunday said MEs should not be given this additional strain as they are struggling from the effects of pandemic lockdowns and the high cost of commodities brought about by the Russia-Ukraine crisis.
“They have very little working capital and whatever they earn for the day, they re-invest in the business just to keep going,” he said. “Many of them are already in debt and now their inputs are more expensive because commodity prices are up. It will be devastating for them.
Concepcion points to a precedent in the exemption when the Regional Tripartite Wages and Productivity Board in Region V provided an exemption in 2004. It excluded from coverage of an order raising minimum wage rates in Region V, “workers registered in Barangay Micro Business Enterprises (BMBEs).”
Additional exemptions were made for “retail/service establishments regularly employing not more than 10 workers, distressed establishments, new business enterprises, and establishments adversely affected by calamities.”
NWPC executive director Criselda Sy said BMBEs have to get certificate of authority from the Department of Trade and Industry.
Sy said business establishments in areas affected by natural calamities may also apply for an exemption to the wage hike order.
Meanwhile, Labor Secretary Silveste Bello III on Sunday said he expect other regional wage boards to also issue their respective orders expediting the current minimum wage in their areas.
There were 10 wage hike petitions filed with six regional wage boards involving the NCR and Region 6, Regions 3 (Central Luzon), 4A (Calabarzon), 7 (Central Visayas) and 8 (Eastern Visayas).
Under the order announced last week, Metro Manila workers will be granted a P33 wage hike, raising the minimum wage rate in the National Capital Region to P570 for the non-agriculture sector and Php533 for the agriculture sector. In the Western Visayas, non-agriculture, industrial, and commercial workers will receive a hike of P55 and P110. The daily minimum wage here will be P450 and P420 for those employing more than 10 workers and those employing 10 or less workers, respectively. In the agriculture sector, the increase will be P95, bringing the daily minimum wage to P410. The board has also approved a P500 wage increase for domestic workers. – With A. Hachero
