Business groups bargain for terms in proposed P150 wage hike
MANILA -Three major, local business groups are seeking a compromise to the planned P150 across-the-board daily wage hike in the Senate, including the exemption of local firms engaged in direct exporting, as well as a “graduated” implementation of any legislated salary increase.
Robert Young, president of Foreign Buyers Association of the Philippine (Fobap), told the Inquirer on Friday that these proposals are backed by their group, as well as by the Employers Confederation of the Philippines (Ecop) and the Philippine Exporters Confederation Inc. (PhilExport).
Young said that a proposal jointly signed by the three trade associations will be sent to the Senate early next week.
The Fobap official said that one of their major suppliers of hard goods was contemplating on transferring their operations in Indonesia should the proposed wage hike push through.
Potential job losses
“This supplier is producing $200,000 to $300,000 (P11.1 million to P16.7 million) worth of hard goods to Target stores. Target is one of our biggest clients,” Young said in a phone interview, referring to the American retailer and supermarket chain.
He added that this single supplier employs more than three thousand people, meaning that closing down their operation in the Philippines would mean a drastic loss of local jobs.
Young said they were also hoping that the wage increases will be implemented in tranches instead, saying that a P150-wage hike would dampen business viability too much if applied all at once.
Passed on costs
“That P150 wage hike per day will be part of the computation for the price of our exports. That’s a huge amount. That’s $3. It would be much more acceptable if it’s just P50,” Young said.
Earlier on Monday, Senate President Juan Miguel Zubiri said that Senate Bill No. 2002, or the proposed Across-the-Board Wage Increase Act of 2023, has already been approved by the Senate committee on labor, employment and human resources.
Zubiri, who chairs the committee, said they hope to pass the bill before the upper chamber adjourns in June.
In the explanatory note of the proposed law, the veteran lawmaker said that “a legislated wage increase is called for to ease the effect of wage erosion brought about by inflation.”
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