Employers said a proposal to cut working hours of workers in the private sector will increase the cost of their operations as it effectively raises wages without going through consultation.
The Employers Confederation of the Philippines (ECOP) has opposed House Bill No. 309, also known as the 35-hour workweek bill.
Given the significant impact of the ongoing new coronavirus disease 2019 pandemic to businesses and the economy, ECOP said the last thing employers would like to see is a law that allows a shorter work week and imposes additional financial burden through the subtle increase of the minimum wage and payment of overtime pay in a shorter work week.
The bill presupposes that a shorter working week increases productivity, eases the traffic congestion in Metro Manila, and strengthens the economy.
The 35-hour workweek in the private sector is an alternative work arrangement from the current 48-hour work week or 40-hour workweek. Employers may implement the scheme upon the request of their employees or on a voluntary basis upon such terms and conditions they may mutually agree upon.
The bill said employees under a 35- hour working week scheme shall receive a rate of pay, including overtime, night shift differential and other similar monetary benefits not lower than those provided in applicable laws, and collective bargaining agreements, among others.
ECOP is particularly concerned about the fact employers would be paying the same rate to an employee working for 35 hours and someone who works for 48 hours.
“This will have the effect of increasing a worker’s daily wage rate even without the approval of the Regional Tripartite Wage Productivity Board (RTWPB) which is mandated by law to be responsible for setting minimum wages and promoting productivity improvement programs,” said Antonio Abad Jr., ECOP governor and chair of Labor and Social Policy Group.
Abad said the bill once enacted may not only result to an encroachment upon the authority of the RTWPB to determine the minimum wage of a particular region, but would also have an adverse impact of increasing the cost of doing business and would be particularly injurious to micro, small and medium enterprises as it effectively increases the rate of an employee’s daily wages.
Another cause for concern for ECOP is the issue on the payment of overtime pay.
ECOP said under the Labor Code, any work done beyond 8 hours shall be considered as overtime work which is based from a 48 or 40-hour work week scheme.
However, under HB 309, any work done beyond 8 hours is considered as overtime work without taking into account the reduced work week of 35 hours.
“With this provision in place, the employer does not only lose on productivity and working hours weekly, but is also mandated to pay for overtime work for any work done beyond 8 hours in a shorter 35-hour work week,” Abad said.