The minimum wage in Metro Manila, Philippines varies depending on the industry and the size of the company. The minimum wage rates in Metro Manila are set by the Regional Tripartite Wages and Productivity Board (RTWPB) and are subject to periodic review and adjustment based on prevailing economic conditions. The minimum wage rates are meant to provide a basic standard of living for workers in the region.
It is important to note that Metro Manila or officially National Capital Region (NCR) is composed of the cities of Caloocan, Las Pinas, Makati, Malabon, Mandaluyong, Manila, Marikina, Muntinlupa, Paranaque, Pasay, Pasig, Quezon, San Juan, Taguig, and Valenzuela and Municipalities of Navotas and Pateros.
Factors Affecting Minimum Wage Rates
Several factors affect the determination of minimum wage rates in Manila. Some of these factors include the current economic situation, cost of living, productivity, and inflation rates.
The National Wages and Productivity Commission or NWPC considers the current economic situation in the country, including the gross domestic product (GDP) growth, employment rate, and poverty incidence. The cost of living is also taken into account, as it reflects the amount of money needed to sustain a basic standard of living. Productivity and inflation rates are also significant factors that affect the minimum wage rates.
Moreover, the NWPC also consults with various stakeholders, such as labor groups, employers, and government agencies, to ensure that the minimum wage rates are fair and just for all parties involved.
Why is the Minimum Wage Important?
The minimum wage serves as a tool to protect workers from being exploited by employers. It sets the minimum amount that employers must pay their employees, ensuring that they can afford basic necessities such as food, housing, and healthcare.
Impact of Minimum Wage Rates
The minimum wage rates in Manila have a significant impact on the daily lives of workers and their families. It affects their ability to provide for their basic needs, such as food, shelter, and healthcare. A higher minimum wage rate can lead to an increase in the purchasing power of workers, which can stimulate consumer spending and boost the local economy.
On the other hand, employers may face challenges in complying with the minimum wage rates, especially if they operate in industries with low profit margins. Some employers may opt to reduce their workforce, cut back on employee benefits, or increase the prices of their products and services to offset the increase in labor costs.
Wage Order No. NCR-24
Approved on June 26, 2023 and published at the Philippine Star on June 30, 2023, Wage Order No. NCR-24 will become effective on July 16, 2023. The Wage Order provides a forty-peso (P40.00) increase in daily minimum wage for employees in the private sector which resulted in a P610 and P573 daily wage rate for Non-Agriculture and Agriculture workers, respectively. Said Wage Order is to be applied to workers in the region regardless of the position, designation or status and irrespective of the method on how their salary or wages are paid e.g. daily, weekly or semi-monthly.
As per Section 2 and 3 of the Wage Order, below is the new daily minimum wage in Metro Manila which is based on a normal eight-hours of work:
Wage Order No. NCR-DW-03
As for Domestic Workers, Wage Order No. NCR-DW-03 issued on 21 June 2022 and published on 27 June 2022 at The Philippine Star, a One thousand peso (P1,000) increase on their monthly minimum wage rate took effect on July 21, 2022. Our dear general house help, caregivers, cooks, gardener, laundry person and any other person doing similar work will now be entitled to a Six Thousand pesos (P6,000) monthly minimum wage. As per Section 3 of the Wage Order, payment of their wages should be in cash and at least once a month.
What Happens if Employers Do Not Comply with the Minimum Wage Law?
Employers are required by law to pay their workers at least the minimum wage rates set by the RTWPB. Violations of minimum wage laws can result in penalties and sanctions. Workers who are not paid the minimum wage can file a complaint with the DOLE, who will investigate and take appropriate action.
Wage Orders play a vital role in ensuring fair compensation and benefits for employees in the National Capital Region. It significantly affects both employers and employees in the private sector, helping to improve labor conditions and addressing the rising cost of living. Employees and domestic workers benefit from increased wages, while employers must adhere to the order's provisions to maintain compliance and avoid penalties. Staying informed about this wage order is essential for both parties to ensure fair treatment and a harmonious working environment.
Want to know how to compute your daily rate? Please visit our blog on How to calculate your employees' daily rate.
In AanyaHR, you will no longer have to worry about hourly and daily rates of your employees as these are automatically calculated. We have many computation options to select from which we continuously update with the latest rules. Payslip is readily available which can be downloaded, viewed on mobile app, web or e-mailed to each employee.
Source: DOLE NWPC