One in five firms violate wage law

Wednesday, 11 May 2011 09:19

Workers in one-fifth of the country's firms may not be able to enjoy the new round of pay raises if the current 20 percent non-compliance rate in wage orders is not remedied by more labor inspections, Rep. Juan Edgardo Angara warned today.

Angara said wage hikes - like the P22 a day cost-of-living allowance (COLA) granted by the Metro Manila wage board on Monday - are usually disobeyed by one in five firms.

He said almost 19 percent of the 35,391 companies visited by Labor inspectors last year were found to be shortchanging their minimum wage workers of their mandated pay.

"This shows that issuing wage orders is just half of the work. The other half is to see to it that the orders are followed. The proof is not in the issuance (of the order) but in its compliance . Wage orders must find their way not into newspapers but inside pay
envelopes," Angara said.

The Laban lawmaker said fielding more Labor inspectors is one way of improving wage compliance "as these personnel have been been able to make on-site corrections of minimum pay violations."

Last year, 1,533 out of the 6,618 firms found violating wage orders made an "on-the-spot rectification of their mistake," Angara said.

At present, statutory minimum daily wages in the country range from P142 for small firms employing not more than 10 workers in the Mindoro-Marinduque-Romblon-Palawan (MiMaRoPa) region, to P404 for
non-agricultural workers in Metro Manila.

The latter's mandatory floor pay has, however, been effectively increased to P426 a day following the grant of the P22 COLA, a concession to employers as the COLA is not factored in the computation of overtime pay and 13th month pay, among others.

Angara said one way of looking at the 20 percent non-compliance rate by firms of wage orders is by "extrapolating it to mean that one in five minimum wage workers does not get the pay he deserves under the law."

"If we look at it from this viewpoint and use this benchmark, then there are probably tens of thousands of affected workers," he said.

Angara said companies in distress or those that will land in that situation should they be forced to comply with a wage order they can't afford should apply for exemptions provided in the wage order itself.

"There are standards and mechanisms for exemption and if a company thinks it is entitled to some relief then it must apply for one, and the wage board concerned should act on it fast. That is the right way. Self-exemption is not the way to do it," he said.

Angara urged Labor officials to process the application in a fast and fair matter that will hear all sides because a wage increase should not be at the expense of bankrupting the firm which will lead to the loss of jobs .

He also exhorted other wage boards to heed President Aquino's appeal for them to speedily act on wage hike applications.