The Department of Labor and Employment (DOLE) through its attached agency, the National Wages and Productivity Commission (NWPC), is proposing the adoption of a new wage system that will replace the current minimum wage setting in the country.
According to NWPC Executive Director Ciriaco Lagunzad III, the proposed two-tiered wage mechanism seeks the provision of floor wage to protect the income of vulnerable workers and enterprise productivity-based approach in determining wages above the minimum. He explained that the first tier is a mandatory national wage, or a floor wage, which will protect the incomes of the most vulnerable sectors from undue low wages. The second tier above the national floor is productivity-based. This seeks to encourage improved work performance, remove the disincentive for collective bargaining, and promote bipartite modes in determining wages and other terms and conditions of work.
Exec. Dir. Lagunzad said that the current wage system is vulnerable to inflation and unemployment, increases informality, distorts pay structures, weakens incentive for collective bargaining, and discourages pay-for-performance schemes.
Under the current setting, the Regional Tripartite Wages and Productivity Board (RTWPB) adjust the minimum wage based on petitions filed by labor groups or motu propio (on its own). Before granting or declining the petition, a series of consultations and public hearings are held to determine the effect on both sides – the employer and employee as well as other sectors involved.
DOLE Sec. Rosalinda Baldoz said that a two-tiered wage policy reform can be initiated within the present system of wage fixing under RA 6727 or the Wage Rationalization Act. Under said law, the RTWPB is allowed to set the minimum or floor wage rates in the region along industry lines, and promote productivity improvement at all level.
Baldoz also said the members of the RTWPB in various parts of the country and the NWPC are conducting consultative meetings with different labor and e mployer groups to facilitate policy formulation on the development of compensation strategies based on workers and enterprise performance and productivity.
“The consultative meetings aim to pursue higher wages based on performance and productivity, and eliminate vulnerability among the working poor,” she said. Furthermore, the consultations between the RTWPBs and the labor sector and employers complement a key item in the 22-point labor and employment agendum of President Benigno S. Aquino III which seeks to align the country’s labor policies with international treaties and International Labor Organization conventions.
According to NWPC Executive Director Ciriaco Lagunzad III, the proposed two-tiered wage mechanism seeks the provision of floor wage to protect the income of vulnerable workers and enterprise productivity-based approach in determining wages above the minimum. He explained that the first tier is a mandatory national wage, or a floor wage, which will protect the incomes of the most vulnerable sectors from undue low wages. The second tier above the national floor is productivity-based. This seeks to encourage improved work performance, remove the disincentive for collective bargaining, and promote bipartite modes in determining wages and other terms and conditions of work.
Exec. Dir. Lagunzad said that the current wage system is vulnerable to inflation and unemployment, increases informality, distorts pay structures, weakens incentive for collective bargaining, and discourages pay-for-performance schemes.
Under the current setting, the Regional Tripartite Wages and Productivity Board (RTWPB) adjust the minimum wage based on petitions filed by labor groups or motu propio (on its own). Before granting or declining the petition, a series of consultations and public hearings are held to determine the effect on both sides – the employer and employee as well as other sectors involved.
DOLE Sec. Rosalinda Baldoz said that a two-tiered wage policy reform can be initiated within the present system of wage fixing under RA 6727 or the Wage Rationalization Act. Under said law, the RTWPB is allowed to set the minimum or floor wage rates in the region along industry lines, and promote productivity improvement at all level.
Baldoz also said the members of the RTWPB in various parts of the country and the NWPC are conducting consultative meetings with different labor and e mployer groups to facilitate policy formulation on the development of compensation strategies based on workers and enterprise performance and productivity.
“The consultative meetings aim to pursue higher wages based on performance and productivity, and eliminate vulnerability among the working poor,” she said. Furthermore, the consultations between the RTWPBs and the labor sector and employers complement a key item in the 22-point labor and employment agendum of President Benigno S. Aquino III which seeks to align the country’s labor policies with international treaties and International Labor Organization conventions.
Trabaho.com. thanks its following sources:
DOLE Labor Communications Office. Two-tiered wage system gains support (Posted October 3, 2010) Retrieved October 4, 2010 from
http://www.dole.gov.ph/secondpage.php?id=1400
GMANews.tv. DOLE: 2-tiered wage system gaining employers' support (Posted October 2, 2010) Retrieved October 5, 2010 from
http://www.gmanews.tv/story/202455/dole-2-tiered-wage-system-gaining-employers-support
Inquirer.net. DoLE may replace minimum wage system with 2-tiered wage (Posted August 5, 2010) Retrieved October 4, 2010 from
http://globalnation.inquirer.net/news/breakingnews/view/20100805-285034/DoLE-may-replace-minimum-wage-system-with-2-tiered-wage
DOLE Labor Communications Office. Two-tiered wage system gains support (Posted October 3, 2010) Retrieved October 4, 2010 from
http://www.dole.gov.ph/secondpage.php?id=1400
GMANews.tv. DOLE: 2-tiered wage system gaining employers' support (Posted October 2, 2010) Retrieved October 5, 2010 from
http://www.gmanews.tv/story/202455/dole-2-tiered-wage-system-gaining-employers-support
Inquirer.net. DoLE may replace minimum wage system with 2-tiered wage (Posted August 5, 2010) Retrieved October 4, 2010 from
http://globalnation.inquirer.net/news/breakingnews/view/20100805-285034/DoLE-may-replace-minimum-wage-system-with-2-tiered-wage
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