A coalition of 10 significant business organizations voiced their strong opposition to the proposed P200 Daily Across-the-Board Wage Increase Act, which was recently approved by the House Committee on Labor and Employment.
In a joint statement, the Employers’ Confederation of the Philippines, the Philippine Chamber of Commerce and Industry, and the Philippine Exporters Confederation Inc., along with key business sector partners, warned that the blanket wage hike would have severe consequences for businesses, particularly small and micro enterprises (SMEs), and could harm the overall Philippine economy.
The Philippine Hotel Owners Association, the Philippine Association of Legitimate Service Contractors , the Philippine Retailers Association, Semiconductor and Electronics Industries in the Philippines Inc., Philippine Constructors Association Inc., the Federation of Filipino-Chinese Chambers of Commerce and Industry, and the People Management Association of the Philippines also signed the statement.
While the groups acknowledged the importance of improving workers’ welfare, they pointed out that the proposed wage increase would disproportionately burden employers.
The allied business groups argued that micro, small, and medium enterprises (MSMEs) make up 99 percent of businesses in the Philippines, struggle with rising operational costs, and with limited financial flexibility, these businesses face significant challenges in absorbing an across-the-board wage hike.
“The mandatory wage hike will place a heavy financial strain on employers, particularly in industries where labor costs represent a significant portion of their expenses. In many cases, businesses will be forced to pass these increased costs on to consumers in the form of higher prices for goods and services, they said in a letter to House labor and employment panel chair Rep. Juan Fidel Felipe Nograles.
The letter, dated February 4, 2025, noted that the bill does not account for the approximately 70 percent of the Philippine workforce employed in the informal sector.
The coalition highlighted that this could deepen the divide between formal and informal workers, leaving a significant portion of the workforce without support, and potentially driving these workers further into economic uncertainty.
