The Department of Labor and Employment (DOLE) has issued an advisory to gui8de employers and workers on the proper implementation of wage adjustments arising from the minimum wage orders issued by the Regional Tripartite Wages and Productivity Boards (RTWPBs).
The advisory, which was signed by Labor Secretary Silvestre Bello III on January 6, 2023, aims to correct the wage distortions that may occur when the minimum wage rates are increased in different regions.
According to the advisory, employers are required to pay their workers the prescribed minimum wage rates in their respective regions, regardless of their position, designation, or status of employment.
However, if the increase in the minimum wage rates results in the elimination or severe compression of the wage structure within an establishment, the employer and the workers may agree on a reasonable and equitable adjustment of the wages of other workers not covered by the minimum wage orders.
The advisory also states that the wage adjustment should not be lower than the applicable minimum wage rates and should not result in a reduction of existing wages and benefits.
The employer and the workers should also observe the principle of non-diminution of benefits, meaning that any benefit or supplement being enjoyed by the employees cannot be reduced, diminished, discontinued, or eliminated by the employer.
The DOLE further advises that the employer and the workers should document their agreement on the wage adjustment in writing and submit a copy to the DOLE Regional Office or Provincial/Field Office where the establishment is located. The DOLE will then monitor and evaluate the implementation of the agreement and provide technical assistance as needed.
The DOLE also reminds employers and workers that they can avail of productivity improvement programs and services offered by the National Wages and Productivity Commission (NWPC) and its RTWPBs to help them cope with the challenges brought about by the minimum wage orders.
These programs and services include productivity training, consultancy, information dissemination, advocacy, research, and productivity-based incentive schemes.