Minimum Wage Fixing Machinery (Agriculture) Convention, 1951 (No. 99) - Philippines (RATIFICATION: 1953)

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The Committee notes the information provided by the Government, which answers the points raised in its previous direct request and has no further matters to raise in this regard.

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Article 1(3) of the Convention. Scope of application. The Committee recalls its previous comment in which it noted that Barangay Micro Business Enterprises (BMBEs) have been excluded from the coverage of the minimum wage legislation. In its report, the Government indicates that 3,505 BMBEs employ 13,263 workers, which represent less than one per cent of all establishments and also less than one per cent of the total workforce. In addition, the Government indicates that the exemption from the scope of the minimum wage legislation is an incentive to support the growth of micro-enterprises and that the employees concerned are still entitled to the same benefits given to all regular employees with respect to social security and health care.

In this connection, the Committee notes section 2 of the Department of Labour and Employment (DOLE) Order No. 45-03 of 2003, which provides that Regional Tripartite Wages and Productivity Boards (RTWPBs) must issue a wage advisory for BMBEs based on guidelines issued by the National Wages and Productivity Commission (NWPC). The range of wage levels proposed by the RTWPBs is advisory in nature and may be used by BMBE workers and employers in setting reasonable wage levels in their enterprises. The Committee further notes the NWPC Guidelines No. 01 of 2003 concerning the issuance of wage advisories for BMBEs, which provide that the non-binding wage advisories are meant to exert a persuasive effect on BMBE owners and provide a benchmark for workers, and that the workers and owners of BMBEs are encouraged to set mutually acceptable wage rates. In the light of these provisions, the Committee observes that the minimum wage regulation for BMBE workers is entirely permissive, and as a result, these workers would possibly face undue pressure from their employers. It is noted that prior to the adoption of wage advisories, RTWPBs are expected to conduct studies of social and economic factors, seek assistance of relevant entities or persons, and consult with affected sectors. The Committee is of the view that minimum wages for BMBE workers are not sufficiently protected, no matter how limited the number of BMBE workers or establishments may be on a national scale. The Committee recalls that the Convention allows for the exclusion only of those categories of persons whose conditions of employment render the provisions of the Convention inapplicable to them, such as members of the farmer’s family employed by him or her. The Committee accordingly requests the Government to take appropriate action to ensure that BMBE workers enjoy the coverage of binding and legally enforceable minimum wages established in accordance with the Convention.

Part V of the report form. Application in practice. The Committee notes the information provided by the Government, according to which as of August 2012, the daily minimum wage rates in agriculture range from 210–409 Philippine pesos (PHP) (approximately US$5.00–9.80) for the plantation sector, and from PHP190–409 (approximately $4.60–9.80) for the non-plantation sector. The Committee requests the Government to continue to provide up-to-date information on the practical application of the Convention, including information on the two-tiered wage system currently implemented by the NWPC.

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The Committee notes the information provided by the Government in its report.

Article 3, paragraphs 4 and 5, of the Convention. Minimum wage not subject to abatement. The Committee notes the Government’s statement that under the Barangay Micro Business Enterprises (BMBE) Act of 2002 (Republic Act No. 9178), BMBEs or enterprises engaged in the production, processing or manufacturing of products, including agro-processing, as well as trading and services, with total assets of not more than 3 million pesos (PHP) (approximately US$68,000) are exempted from the coverage of the minimum wage legislation. The Government adds that this measure aims at encouraging the growth of Barangay Micro Business Enterprises and concerns some 4,097 registered BMBEs. The Committee is bound to recall, in this connection, that the Convention allows only for limited exceptions in individual cases to prevent curtailment of the opportunities of employment of physically or mentally handicapped workers and therefore the broad exceptions permitted under the abovementioned Act are inconsistent with the requirements of Article 3, paragraph 5, of the Convention and the overriding principle of the binding force of minimum wages. The Committee wishes also to recall that as it pointed out in paragraph 61 of the General Survey of 1992 on minimum wages, the purpose of regulating minimum wages in agriculture is to prevent wages which are much lower than those paid in industry and that the Convention was seen as a way of promoting economic and social conditions that would turn agriculture into a remunerative occupation and lay the foundations for higher standards of living for all agricultural workers. The Committee requests the Government to indicate whether and how minimum permissible wage levels are determined for workers engaged in agricultural undertakings covered under the BMBE Act, and also how it is ensured that any such levels are adequate for meeting the basic needs of agricultural workers and their families. The Committee further asks the Government to provide more detailed information on the approximate number of agricultural workers currently exempted from the coverage of the minimum wage legislation.

Article 5 and Part V of the report form. The Committee notes that, as of September 2007, the minimum wage rates in agriculture range from PHP180 to 325 (approximately US$4.1 to 7.5) for the plantation sector, and from PHP170 to 325 (approximately US$3.9 to 7.5) for the non-plantation sector. It also notes that the average daily gross basic pay for agricultural workers rose from US$2.7 in 2004 to US$3.4 in 2006. It further notes the information on the size of the workforce in the agriculture, hunting, forestry and fishing industries, which, as of October 2006, amounted to 12.17 million workers, or 34 per cent of the total workforce. The Committee notes the Government’s indication that there are currently no sector-disaggregated data on labour inspection, while the average compliance rate with the minimum wage legislation is 82.6 per cent. The Committee would be grateful if the Government would continue supplying up to date information on the practical application of the Convention.

Finally, the Committee wishes to draw the Government’s attention to the conclusions of the ILO Governing Body on the continued relevance of the Convention based on the recommendations of the Working Party on Policy regarding the Revision of Standards (GB.283/LILS/WP/PRS/1/2, paragraphs 19 and 40). In fact, the Governing Body has decided that Convention No. 99 is among those instruments which may no longer be fully up to date but remain relevant in certain respects. The Committee therefore suggests that the Government should consider the possibility of ratifying the Minimum Wage Fixing Convention, 1970 (No. 131), which marks certain advances compared to older instruments on minimum wage fixing, for instance, as regards its broader scope of application, the requirement for a comprehensive minimum wage system, and the enumeration of the criteria for the determination of minimum wage levels. The Committee requests the Government to keep the Office informed of any decision taken or envisaged in this regard.

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Article 5, in conjunction with Part V of the report form. The Committee notes the data supplied by the Government in its report regarding the agricultural minimum wage rates currently in force by region. It also notes that, according to the latest statistics, some 9.7 million persons, or 32.4 per cent of total workforce, are employed in the agriculture, hunting and forestry sectors. The Committee requests the Government to continue supplying up-to-date information on all aspects of the implementation and enforcement of the minimum wage legislation in respect of agricultural workers, including for instance extracts from inspection reports and relevant judicial decisions. In addition, the Committee asks the Government to keep it informed of any recent decisions authorizing exclusions from prescribed minimum wage rates under section 122(e) of the Labour Code, and to indicate the number of agricultural enterprises and workers concerned.

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The Committee notes the detailed information supplied in the Government's report in reply to its previous comments.

Article 5 of the Convention and point V of the report form. The Committee notes the Government's estimations concerning the number of workers covered by the Wage Orders granting increases in minimum wages and the role of the regional offices of the Department of Labor and Employment (DOLE) in the enforcement of general labour standards, including minimum wages. It also notes the regional minimum wage rates by region and major industry, as well as the agricultural wage statistics contained in the 1996 Philippine Yearbook of Labor Statistics.

The Committee requests the Government to continue to provide general information on the effect given in practice to the Convention in the agricultural sector, for instance: (i) the minimum wage rates in force; (ii) the available statistical data on the number and various categories of workers covered by minimum wage regulations; and (iii) the results of the inspections carried out (e.g. the number of the violations reported concerning minimum wage provisions, the sanctions imposed, etc.).

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The Committee notes the information supplied by the Government in reply to its previous comments, concerning, in particular, Article 5 of the Convention.

1. With reference to its previous comments, the Committee again requests the Government to indicate whether any agricultural enterprises have been exempted from the application of Act No. 6727 of 1988 in virtue of its section 5.

2. As regards the applications for exemption from prescribed wage rates under section 122(e) of the Labour Code, as amended by the above Act, the Committee notes the Government's indication that 2,613 such applications were received in total, including agricultural enterprises, between January 1991 and June 1992, and that two cases concerning agricultural enterprises have been appealed to the National Wages and Productivity Commission, contesting the decisions by the Regional Board on such exemption. The Committee requests the Government to continue supplying information on such exemption with separate figures, as much as possible, regarding agriculture and including such information as the number of workers concerned. It also asks the Government to supply, if any, prescribed rules or guidelines concerning the criteria to be applied when granting such exemption.

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1. Article 3, paragraph 5, of the Convention. The Committee refers to its observation and notes that by virtue of section 127 of the Labour Code, as amended by Act No. 6727 of 25 July 1988, no wage order issued by any tripartite Regional Board shall provide for wage rates lower than the statutory minimum wage rates prescribed by the national Congress. It notes, however, that section 5 of the above Act authorises, under certain conditions, temporary exceptions from the application of the new provisions for wages in enterprises located outside certain territorial zones, which need financial assistance for their operations and investments, and that section 122(c) of the Code, as amended by Act No. 6727, provides that, among their other responsibilities, the tripartite Regional Boards are empowered to receive and process applications for exemptions from legal provisions prescribing wage rates.

The Committee requests the Government to indicate: (a) whether exemptions as set out in section 5 of the above Act have been granted to agricultural enterprises located in the territorial zones under consideration and; (b) whether tripartite Regional Boards have processed applications from agricultural enterprises for exemption from the applicable minimum wage rates.

2. The Committee requests the Government to indicate whether the regulations referred to in section 13 of Act No. 6727, intended to implement the provisions of the Act have been adopted and, if so, to supply their text.

3. The Committee would be grateful if the Government would also supply information on the methods by which effect is given in practice to the minimum wage-fixing machinery in agriculture and on the occupations and numbers of workers covered by the above legislation and the minimum rates of wages fixed, in accordance with Article 5 of the Convention.

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Article 3, paragraphs 2, 3 and 5, of the Convention. With reference to its previous comments, the Committee notes with satisfaction, from the information supplied by the Government, the adoption of the Wage Rationalization Act No. 6727 of 25 July 1988 amending a number of provisions in the Labour Code concerning wages, including section 99 which no longer allows certain enterprises situated in critical zones (including agricultural enterprises) to pay wages that are 50 per cent lower than the minimum wage.

The Committee also notes with interest that sections 120 to 125 of the new Act (which amend the corresponding sections of the Labour Code) provide for the establishment of a National Wages and Productivity Commission and regional boards of tripartite composition which will have, among its responsibilities, the formulation and implementation of Government policy relating to wages and the determination of minimum wage rates at the national, regional and industry levels. The Committee also notes that employers' and workers' organisations will have the opportunity to be consulted on wage rationalisation and productivity during meetings specially held for this purpose.

The Committee requests the Government to supply information on the implementation of these new measures and on certain other points that are raised in a request that is being addressed directly to it.