Wage hike before Arroyo gov’t exit not ruled out

One more round of wage hikes could be squeezed in by the Arroyo administration before its term ends as labor begins the process of seeking adjustments, officials said on Tuesday. As the economy recovers, groups such as the Trade Union Congress of the Philippines (TUCP) have started asking for higher minimum wages. Petitions for an additional P75 per day have been submitted in Metro Manila and Davao, with more scheduled in the next days. A run of annual wage hikes since 1989 — when wage setting was transferred to regional boards from Congress — was broken last year as labor groups acknowledged the impact of the global economic downturn. Asked if the Arroyo administration was leaving the wage hike issue for its successor to decide, Deputy Presidential Spokesperson Gary B. Olivar said: "It’s being faced by the government now. We’re not completely ruling out anything." Filipinos will pick a new set of leaders on May 10. Esther F. Guirao, deputy executive director of the National Wages and Productivity Commission (NWPC), said a compromise was being contemplated. "We may or may not grant a wage hike. There are companies that can afford to absorb a wage hike, while others are still trying to recover from the crisis so there will be some compromises during consultations," she said. An option to grant companies a one-year reprieve from any wage hike was broached during ongoing consultations, Guirao pointed out. Employers, meanwhile, rejected any increase, insisting that they preferred nonwage benefits. Employers Confederation of the Philippines President Edgardo G. Lacson said current economic conditions do not warrant salary adjustments. "There’s a big possibility of companies closing down or others trimming down employees just to be able to comply with the wage order," he said. He instead proposed nonwage benefits such as rice, transport and clothing subsidies, and the integration into the basic pay of cost of living allowances depending on an employer’s financial health. John D. Forbes, American Chamber of Commerce of the Philippines legislative committee chairman, said any wage hike would further erode the competitiveness of the Philippine labor market, already threatened by free trade and lower wages in other Southeast Asian countries. "The economic principle is that if wages are raised then productivity will increase. In the Philippines, labor productivity has not been increasing for the last 20 years," Forbes claimed. While agreeing to an improved nonwage package, the TUCP said its call for a minimum wage hike was "nonnegotiable." "These (benefits) are not a replacement to the wage increase... [Management] should pity the workers. They just have to reduce their profits," said Alex G. Aguilar, secretary-general of the TUCP in Davao. The TUCP’s petition before the regional wage board in Davao seeks the integration of a P15 cost of living allowance on top of the P75 increase. Minimum wage earners in Davao currently receive P265 daily. The association might also resort to calling a nationwide strike "if need be," Aguilar said, pointing out that a mass action is "always an option." "I believe that the wage board will definitely grant a wage hike. The only question there is how much," said Cedric R. Bagtas, TUCP deputy secretary-general. The militant Kilusang Mayo Uno (KMU) said its officials, together with party-list legislators Satur C. Ocampo and Liza L. Maza, would push for a special session of the House labor committee for the passage of House Bill 1722, which calls for a P125 daily across-the-board wage increase. The 14th Congress adjourned last Feb. 5 and many legislators are now busy with their reelection bids. "We did not file petitions at the wage board because we see it as the government’s instrument to avoid a substantial wage hike," KMU public information officer Wendell M. Gumban said. — Ma. Aizl Camille B. Cabarles, Carmelito Q. Francisco and Gerard S. dela Peña, BusinessWorld