With prime commodities going nowhere but up, wage increase has been in demand. However, the increase in the wage involves a process to determine how much the employee is going to receive. This is where the Wage Order comes in. The Regional Board is going to gather pertinent facts following certain criteria and standards. With these facts, the board shall determine whether or not a Wage Order will be issued. The Wage Order fixes the wage in the region. The Wage Order covers private employees but not government employees. It should commence after 15 days from the completion of at least one newspaper publication. This is under Art. 123, Labor Code, which was amended by Republic Act RA 6727 or also referred to as the Wage Rationalization Act.
When does wage increase take effect?
Only one wage increase is allowed every year hence, a wage order will only be issued once a year. If a wage increase is requested within the 12-month period, it shall not be entertained. However, there is an exception to the rule, following the supervening condition. For instance, if there is a drastic increase in the prices of basic goods and services or petroleum products, the wage increase within the 12-month period may be considered. The Regional Wage Boards will determine supervening condition’s existence and will be confirmed by the National Wages and Productivity Council (NWPC). The Regional Wage Boards is responsible for determining and fixing minimum wage rates applicable in their provinces, regions or industries.
A Wage Order cannot be issued without a public hearing or consultation being conducted. Employees and employers’ provincial, city, groups and municipal officials will be given notices as well.
The Criteria For Fixing The Minimum Wage
There are relevant factors that must be considered before the increase in the wage takes effect:
• Standards of living improvements;
• The increase in the cost of living;
• Living wages demands;
• Adjustment on wage based on the consumer price index;
• The needs of workers and their families;
• Effects on family income and employment generation;
• The wage levels;
• The demand for inducing industries to invest in the countryside; and
• The income’s equitable distribution.
Both the employer and the employee must observe the minimum wage that was provided in the Wage Order. The employer is prohibited to pay an amount that is lower than amount stipulated in the Wage Order and the employee cannot demand an amount higher than the amount fixed in the Wage order. In some cases, freedom to bargain is allowed in particular enterprises and firms.
