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Minimum Wage

The document discusses minimum wage policies in the Philippines. It outlines that minimum wages are set regionally by tripartite wage boards and can vary from PHP 282 to PHP 537 per day depending on the region and industry sector. The two-tiered wage system was implemented in 2012, which sets a mandatory minimum wage as the first tier and allows for voluntary productivity-based supplementary pay as the second tier to encourage competitiveness while still protecting workers. When establishing minimum wages, it is important to specify which pay components count toward the minimum and how it applies to piece-rate workers.

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Syrel jane Garay
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58 views15 pages

Minimum Wage

The document discusses minimum wage policies in the Philippines. It outlines that minimum wages are set regionally by tripartite wage boards and can vary from PHP 282 to PHP 537 per day depending on the region and industry sector. The two-tiered wage system was implemented in 2012, which sets a mandatory minimum wage as the first tier and allows for voluntary productivity-based supplementary pay as the second tier to encourage competitiveness while still protecting workers. When establishing minimum wages, it is important to specify which pay components count toward the minimum and how it applies to piece-rate workers.

Uploaded by

Syrel jane Garay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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On June 9, 1989, the Philippine Congress

enacted Republic Act No. 6727 otherwise known as


the “Wage Rationalization Act”.

Each region in the Philippines has a unique


minimum wage set by the Regional Tripartite Wages
and Productivity Boards.
MINIMUM WAGE

• the minimum amount of remuneration


that an employer is required to pay wage
earners for the work performed during a
given period, which cannot be reduce by
collective agreement or an individual
contract

• minimum hourly wage an employer can


pay an employee
All workers and
employers in the private
sectors regardless of their
position, disignation or status
are covered by the minimum
wage.
Purpose of Minimum wages

Minimum wages protect workers against unduly low pay.


They help ensure a just and equitable share of the fruits of
progress to all, and a minimum living wage to all who are
employed and in need of such protection.

Minimum wages can also be one element of a policy to


overcome poverty and reduce inequality, including those
between men and women.
The minimum wage in the Philippines varies between
regions. Each region's tripartite wage boards set the minimun
wage rate, which ranges fron PHP 282 and PHP 537 a day.

The minimum wage rate also depends on the industry


sectors. The industry sectors are broadly divided into
agricultural and non- agricultural.
When an employee spends more than eight hours working,
he or she is entitled to additional pay, as below:

• Night shift
• Over time
• 13- month pay entitlement
• Service incentive leave
• Sick leave
• Maternity & Paternity leave TO-BE
• Solo parent leave
Have them for one. Living
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waters

• Leave for victim of gender violence


• Special leave for gynecological surgery
• Bereavement leave
• Retirement benefits
Advantages of Minimum Wage

✓ Worker Protection

✓ Workforce Motivation This is Minimal

Have them for one. Living grass to for can't gathered waters

✓ Improving Economy
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seasons. Fifth you'll, man wherein seas our creeping. Very.

Make from for seas place divided void

Welcome ✓ Social Stability


Disadvantages of Minimun Wage
✓ Unemployment

✓ Firm may become uncompetitive

✓ Cost- push inflation

✓ Black market

✓ Poorest don't benefit

✓ Limited impact on relative poverty


The objective of the approved increased minimum
wage is to change the lives of ordinary workers but in
reality, the impact of this brings unemployment due to
the increasing cost on the part of businesses.

Salary/wage increases also trigger rise in


commodity prices.
Determining Minimum Wage

In the 2012, the Department of Labor and Employment. (DOLE),


through the National Wages and Produductivity Commission
(NWPC), implemented the two-tiered wage system (2TWS). The
two-tiered wage, as a policy reform measure is aimed at minimizing
the unintended outcomes of mandated minimum wage, improving
the coverage of the vulnerable sectors, and promoting productivity
improvement and gain-sharing.
Two-tiered Wage System

The two-tiered wage system is a reform that


maintains the mandatory minimum wage (under R.dA
6727 or the Wage Rationalization Act) as first tier;
complemented by a voluntary productivity-based pay
scheme as the second tier.
TIER 1: Mandatory floor wage
Minimum wage rates are determined
by factors such as poverty threshold,
prevailing wages rates as determined
by Labor Force Survey, and socio-
economic indicators ( i.e. inflation,
employment figures, Gross Regional
Domestic Product, among others),
which insure better workers protection.
TIER 2:
Voluntary productivity-based pay

Over and above minimum wage is


the voluntary productivity-based pay,
which encourages workers and
enterprises to become more
competitive and productive by
rewarding employees supplementary
pay basedon the quality of their
performance.
In defining a minimum wage it is important to be specific
about which components of a wage can be counted in the
minimum.

• the extent and conditions under which payment in-kind can


be allowed;

• how the minimum is calculated for workers with piece rate


pay; &

• if the minimum is an hourly and/or a monthly rate.

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