Unknown to the many, particularly the business sector, is that the minimum wage in the city is much higher than some major and bigger cities in the country, which in someway could be detrimental in inviting investors here.
The higher minimum wage is due to the fact that Bohol belongs to Central Visayas which provinces are being clustered under one region with Cebu City as the hub. Presently, Cebu City’s minimum wage is P340.
The Chronicle learned that the prevailing minimum wage in Tagbilaran City of P310 is higher compared to major cities like Iloilo City and Bacolod City which is P298 only and General Santos City at P275 only.
The prevailing higher minimum wage here was also one of the reasons why the business sector in the city objected the proposed wage hike which was P92 by the Associated Labor Union -Trade Union Congress of the Phils (ALU-TUCP) while the Alliance of Progressive Labor (APL) proposed a P145 increase.
Engr. Albert Uy, president of the Bohol Chamber of Commerce and Industry, Inc. and Romel Gonzales, president of the Panglao island Chamber of Commerce and Industry, Inc. and Bohol Association of Hotels, Resorts and Restaurants signed the position paper of the Bohol business sector which was submitted during a meeting held at the Sarosa Int’l Hotel in Cebu City. Lawyer Manolet Dinsay represented the local business group during the meeting.
In objecting to the proposed wage, the business sector said that the business community of the province, particularly the tourism industry which is a bulwark sector and a big source of employment for Bohol – has also been severely debilitated by calamities and was just picking up the pieces.
The chamber also cited that the inflation rate in the province has stabilized. The inflation index is lowest in the last four years thus, there is no need to adjust the salary of employees. There is no current price increase on prime commodities in the Province. Likewise, there is no petition for hike on the current minimum wage nor such expressed clamor,-a manifestation that the labor force understands reality in the province and that the need to increase is not yet possible at the moment.
“It is more detrimental than beneficial,” the chamber said.
The business sector reasonably oppose another wage increase legislation at this point in time.
“An increase is too soon and would further worsen the situation of the struggling and recovering micro, small and medium enterprises and the overall economy in addition to the reduced income of exporters brought about by the strengthening of peso, which affects the whole Philippine economy,” the statement said.
Commenting on the move for an across the-board increase, the chamber said it will not realistically benefit the lowest paid workers since employers’ personnel related cost will unnecessarily increase sharply due to the inclusion of those who are already eaming more such as the supervisors, managers and executives.
With the sharp increase, employers will only resort to increases in prices of goods, the least it could do which in turn will result to further inflation, the business sector cited.
The Chronicle learned from the BCCI presentation that the minimum wage here is much higher than China, lndonesia and Thailand and also higher than Vietnam, Jakarta and Beijing.
They cited that this high minimum wage could drive away foreign investments.
The business sector cited that attracting foreign and local investments to the province is the only alternative to generate more employment, enhance income of the unemployed and underemployed, create the purchasing power that in turn propels and promotes added production in agriculture, small and medium enterprises and the service sector.
With the petition to increase the wages across the board, investors would have another severe disincentive to come to Bohol and existing investors might even migrate to other countries with competitive labor costs – an exodus that has already begun in both Luzon and Mindanao provinces.
The chamber further commented that for Unionized establishments, the provisions of their existing collective bargaining agreements shall be respected. This bargaining agreement is a product of thorough and lengthy discussion between the employers and workers’ representative who know better the real financial status of their establishment than any other persons or bodies outside of the said establishment.
For non-Unionized, the BCCI said the employer are encourage to initiate the increase if it is capable of doing so but without compromising the continuity of its operations.
It should be further noted that the free market alone has a tested mechanism of deserved compensation – the only way for active businesses to get capable and qualified workers (both skilled and unskilled) is to become competitive in terms of wages and benefits to their employees among other things.
The business group in their position paper also advised the labor sector to also re-evaluate their values, learn to adjust their lifestyle and prioritize only the daily needs especially in a peculiar and extraordinary situation of recovery and rehabilitation being experienced by our province. They even cited that by tradition, we spend a lot during birthdays, fiestas and family affairs such as reunions, malling and outings.
On the part of the government, the BCCI said it would be better to increase tax exemptions to minimum wage earners in such a way that the move to exempt from paying income tax should be seriously considered and worked out.