P132 wage hike petition: Devoid of logic

Three days from now, the Regional Tripartite Wages and Productivity Board (RTWPB-7) shall meet and probably will discuss the Living Wage Coalition-Cebu’s petition asking for a P132 wage hike.  Therefore, with equal representations, expect some fireworks as the labor and industry representatives relentlessly clash.  As usual, the government’s representative shall come in with the honest intention of doing what is right. 

In trying to understand the present situation, we must take a look at wages in an all-encompassing perspective.  In more professionally managed companies, it is viewed positively as investment not cost.  To some cash-strapped institutions, it is something that they would like to control to survive.  To some miserly affluent companies or businessmen, however, it is something they’ve made their hapless employees continued to starve.  Clearly, in these three scenarios, employers differ in the ways they treat their employees and in their approaches in compensating them.  Some are too generous, a few are reasonable and others are just too stingy.  

On the other hand, laborers or employees differ in many ways too.  Overly protected by our labor laws, even those with salaries three times higher than the established minimum wage are filing notices of strikes.  However, it is a fact too that despite receiving wages way below established floors from unreasonable employers, some laborers just grumble in the corner by their lonesome.  Obviously, they prefer to have little something than have nothing at all.  Indeed, there are varying approaches among employers and employees.  These varied approaches are either necessitated by business and economic conditions or just mere attitude. 

Despite these recognized diversities, however, labor unions can only figure out one common solution, demand for awfully high wage hikes.  Yes, awfully, because pay increases are demanded without any corresponding increases in productivity.  Meaning, company revenues remained the same while costs are increasing.  Apparently, this is a scenario that can only bring decent livelihood-providing companies down on their knees and possibly contribute to the ballooning number of the unemployed.  

In the meantime, however, let us revisit a bit of history on establishing minimum wages.  Lacking in originality, as it has always been, we look into other countries’ practices and take them as our own solution as well.  Truth to tell, establishing minimum wages started in Australia and New Zealand with a noble purpose of ensuring decent standard of living for unskilled workers.  It was perceived as both the wall shielding the workers from exploitation by unjust employers and as a primary weapon in the war on poverty.   Then (1921), in Australia, the federal court established a minimum wage for unskilled workers.  Ignoring the employers’ right to value the workers’ worth vis-à-vis their skills, the workers priced themselves out of the market.  Consequently, unemployment increased and those who insisted to work found some solace from employers who can ill-afford but are willing to break the law.

Australia’s history may also happen here.  For one, the unskilled will suffer the major blow.  With the same amount of pay, companies will definitely go for the skilled ones.  Therefore, as the unskilled workers will turn out to be expensive, the possibility they’ll loss their jobs is imminent.  Furthermore, new entrants in the labor market may not be given the opportunity to work and gain experience.  Obviously, they will miss the opportunity to earn while learning skills and gaining experience.

Despite all these facts and possible courses of adverse actions employers may take, labor unions will certainly remain adamant. They will certainly assert, without basis, to advance their selfish causes or stay relevant before union-dues- paying members.  Moreover, politicians may even try to make their presence felt to seemingly portray their concerns, though, in essence, they are just trying to protect their own political turf.   

Whatever selfish motives some may have, however, there is no shade of a doubt that the demand for a wage increase is noble intentioned and will have wide political support.  Lest we forget, history has taught us that noble intention and wide political support alone are not enough to ensure such approaches bring about good results.  Whether labor unions considered these businesses’ and employees’ predicaments in demanding for these increases, we do not know.  Certainly though, these unreasonable demand is totally devoid of logic.

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