The recent approval of a two-tier wage system (2TWS) in the National Capital Region (NCR) by the labor department creates bigger hurdles for workers in achieving a living wage, labor NGO Ecumenical Institute for Labor Education and Research, Inc. (EILER) said today.
EILER said that under the 2TWS, a productivity-based wage setting is implemented on top of a new floor wage per region. It said that pegging wage increases on productivity “completely binds workers’ wages to the whims of capitalists, as productivity is mainly determined by factors under control of companies.”
“The labor department is opening a Pandora’s box for Filipino workers with the implementation of the two-tier wage system, as the scheme further gives companies the hand in flexing wages. Productivity has always been a variable which capitalists can tinker through various means, such as through use of technology or volume of inputs,” EILER executive director Anna Leah Escresa said.
Escresa explained that the country has generally a low level of productivity due to the backward level of technology and dependence on inputs from foreign countries.
“Under the 2TWS, companies will keep production technologies backward while increasing workload and production inputs, supposedly to increase productivity. In the end, the scheme will squeeze out bigger profits from labor rather than raise workers’ incomes to decent levels,” she said.
“This is the essence of Aquino’s neoliberal policy for labor – putting in place schemes that will jack up corporate profits and press down on wages to entice more foreign investors to come in and make billions from Filipinos’ hardwork,” Escresa added.
The labor advocate also noted that the 2TWS will gravely undermine hard-earned wage increases as stated in existing collective bargaining agreements (CBA) of private sector unions.
“The new wage scheme threatens to destroy the gains achieved by workers in their struggle for higher wages through CBA negotiations, as productivity now becomes the main measure of the amount of increase,” Escresa noted.
‘P30 COLA hike a cheap come-on’
EILER also slammed the P30 installment increase in the cost of living allowance in the NCR, calling it a “cheap come-on” to the 2TWS.
“It appears that the Aquino administration had hoped that the P30 COLA increase will make a productivity-based pay palatable to workers. But such measly increase in allowance can hardly hide the failure of the government to approve a legislated and significant wage increase,” Escresa said.
“The P30 installment pay hike will also hardly make a dent on the mounting expenses of Filipino families, as incessant increases in the prices of commodities, fuel and services will outstrip it even before Christmas,” Escresa said.