Minimum wage regime impractical, unreasonable

The current minimum wage law should be rescinded. It is impractical and unreasonable. A single minimum wage cannot and should not be applied to different industries or classes within one industry. This single yardstick governing workers’s earnings in all business establishments, regardless of type and size, has caused industrial strife and the slowdown of our economy.

Foreign investments have relocated to other countries because of the wage problem, depriving, in effect, millions of Filipinos of employment opportunities. Of course, other factors contributed to the exodus, like the lack of adequate communication facilities, high power cost, unpredictable government policies, red tape, corruption, etc.

More than 50 years ago, Congress enacted the minimum wage law, specifying a fixed minimum wage for all types of businesses. It cannot be denied that politics and the vote were the basic considerations in the enactment of that law. Subsequently, the minimum wage was raised successively to cope with the rising cost of living and appease the labor sector. The elements of vote and politics always accompanied the upgrading, and employers were left with a diminishing space to maneuver. To stay in business, they had to pay wages below the rate set by law. Workers had to accept the lower wages offered—there was no alternative. Employers also resorted to contract employment, whereby job contractors supplied labor at rates below that set by law. Tenure of employment was less than six months to sidestep the law granting regular status to workers. In all these, the worker suffered because the government applied the minimum wage law to all types of industries despite the disparity in the income of different industries and categories within one industry itself.

To put an end to this problem, the government, the business sector and the academe should get together and identify all types of industries and set three categories within each industry, i.e., low, medium and high. Specifically, the Securities and Exchange Commission, the Bureau of Internal Revenue, the Department of Trade and Industry, among others, should get involved in identifying and categorizing industries. Business groups, e.g., the different Chambers of Commerce and Industries and management experts, should also be involved. Economists and business administration authorities in the academe will comprise the third leg of the study. Subsequent to the study and determination of the different types or industries and the three categories within each industry, the minimum wage for each industry and category should be established by a wage board made up of representatives from the government, the business sector and the academe. The set minimum wages will have to be reviewed when the cost of living drastically rises.

—APOLONIO G. RAMOS,

42 Mindanao St., Marikina City