Labor & Minimum Wage Law

I hope to share some insights I have learned from the past few months. Before a foreigner decides to invest in the Philippines, it is essential for him to consider that the working conditions in the country are completely different and distinct from the working conditions in his own country. Thus, under the “general welfare clause” and the “social justice principle” of the constitution of the Republic of the Philippines, the workers are given preferential advantage in the interpretation and construction of labor laws. This, however, does not necessarily mean that Philippine labor law is strictly anti-employer. The Philippines is still one of the best countries in the region for foreigners to invest in as long as potential employers abide to its reasonable labor laws. The conditions of employment are quite fair and reasonable. The regular office hours in the country is eight hours, for five days a week, exclusive of time for meals. Any additional hours of work shall be subject to additional compensation. Aside from national emergencies and prevention of loss of life or property, the worker may be required to work overtime to prevent loss of perishable goods, or to prevent the business from incurring serious losses.

A weekly rest day of at least twenty-four consecutive hours is required for every six consecutive normal work days. Minimum wage rates in the country vary depending on the region where the employee works. As of October 2009, the current daily minimum wage rate in Metro Manila or the National Capital Region (NCR) is P382.00 (the highest in the country). Employees working in the Bicol Region presently receive the lowest wage at the range of between P196.00 to P239.00 per day. Manila Visa also explains that payment by means of a promissory note, voucher, coupons, tokens, chits, or any other object other than the legal tender is expressly prohibited under the law. Some economists suggest that the minimum wage imposes a wage floor that prices cheap labor out of the market, reducing the pool of low-wage jobs.

I think that the minimum wage laws pool low-income, low-skill work into an artificially high floor, removing opportunities to learn new skills and advance in a job or trade. If all low-wage employees are pooled into a single wage bracket, developing employees will not receive crucial training, because the jobs will go to people who can already perform the work without training. Thus, the developing employees will enjoy fewer advancement opportunities.


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