6727 In July 1989, the Philippine Congress enacted into law Republic Act No. 6727
The Act established a new mechanism for
minimum wage determination through the creation of -NWPC (National Wages and Productivity Commission ) -RTWPB(Regional Tripartite Wages and Productivity Boards ) rationalize the fixing of minimum wages promote productivity-improvement and gain- sharing measures just share in the fruits of production enhance employment generation in the countryside through industry dispersal allow business and industry reasonable returns on investment, expansion and growth National Wages and Productivity Commission an attached agency of the DOLE Prescribes rules and guidelines in determining minimum wage formulates policies and guidelines on wages, incomes and productivity and exercises technical and administrative supervision over the RTWPBs The NWPC is composed of the following:
Secretary of Labor and Employment as
ex-officio Chairman
Director-General of the NEDA as
ex-officio Vice Chairman
2 representatives each from the worker and employer sectors (appointed by the President for a term of five years) as Members; and
Executive Director of the NWPC as
Secretariat-ex officio member Regional Tripartite Wages and Productivity Boards
responsible for setting minimum wages per
region and promoting productivity improvement programs
17 RTWPB (including ARMM)
Each RTWPB is composed of the following >DOLE Reg. Director as ex-officio Chairman; >Regional Directors of the NEDA and DTI as ex-officio Vice Chairmen; and >2 representatives each from the worker and employer sectors (appointed by the President for a term of five years) as Members. (1) Needs of workers and their families
-Demand for living wage
-Wage adjustment vis--vis Consumer Price Index (CPI) -Cost of living and changes therein -Needs of workers and their families -Improvements in standards of living (2) Capacity to pay
-Fair return on capital invested and capacity to
pay of employers
-Productivity (3) Comparable wages and incomes -Prevailing wage levels
(4) Requirements of economic and social
development -Need to induce industries to invest in the countryside -Effects on employment generation and family income -Equitable distribution of income and wealth along the imperatives of economic social development In general, the Boards can issue a wage order within 90 days, given the procedural requirements under the Rules of Procedures for Minimum Wage Fixing The Boards are specifically required to issue a wage order within 30 days after conclusion of the last hearing. Thereafter, a Wage Order becomes effective 15 days after it has been published in a newspaper of general circulation in the area of jurisdiction. only once in a given year Within the 12-month period from effectivity of the wage order, no petition for wage increase may be entertained, except: -SUPERVENING CONDITION (i.e extraordinary increase in prices of petroleum products ) A Wage Order take effect fifteen (15) days after its publication in the newspaper of general circulation in the region. Even in the absence of a filed petition for wage increase, Regional Boards can, motu proprio, initiate action or inquiry on whether a wage order should be issued.