DOLE’s wage reforms support PH competitiveness bid

Labor and Employment Secretary Rosalinda Dimapilis-Baldoz yesterday said the wage reforms being pursued by the National Wages and Productivity Commission (NWPC) and its Regional Tripartite Wage and Productivity Boards (RTWPBs) support the country’s initiatives to promote worker and enterprise productivity towards making the country more globally competitive.

Citing the DOLE’s two-tiered wage system (TTWS), a reform in minimum wage setting adopted in 2012, she said the TTWS clarifies the parameters for minimum wage setting in the country, thereby putting discipline in the wage-setting process.

“More importantly, it serves as a deliberate strategy to encourage enterprises and workers to voluntarily implement productivity improvement programs and engage in the fair and reasonable sharing of gains from such programs,” Baldoz said.

Baldoz made these comments after the World Economic Forum had released its 2014/2015 Global Competitiveness Report placing the Philippines in 52nd position out of 144 economies, up by 7 notches from 59th in 2013/2014.  The annual GCR assesses and ranks more than 140 countries according to 12 pillars of competitiveness.

Baldoz noted that in one of the 12 pillars of competitiveness–the labor market efficiency pillar–the country’s ranking had improved 9 notches from 100 in  2013/2014 to 91 this year.

Under this pillar, the country’s performance improved the most in the flexibility in wage determination indicator by 23 notches (109th to 86th) and in the pay and productivity indicator by 17 notches (44th to 27th).

The labor market efficiency pillar has 10 indicators, and in the 2014/2015 Global Competitiveness Report, the Philippines has registered very visible progress in 8 of the 10 indicators, moving up to the 50 percentile in five of these, namely, (1) cooperation in labor-employer relations (29th); (2) effect of taxation on incentives to work (47th); (3)pay and productivity (27th); (4) reliance on professional management (29th); and (5) country capacity to retain talent (60th).

Baldoz said that the NWPC, in the 2013 policy guidelines on the TTWS, had directed the RTWPBs to issue advisories on productivity based incentive schemes to guide enterprises in developing and adopting productivity incentive schemes.

“Following this directive, 13 RTWPBs have issued advisories for their region’s growth or priority sectors.  The rest of the Boards are expected to issue their advisories within the year,” Baldoz bared.

The labor and employment chief also said that the DOLE, through the NWPC and the RTWPBs, provide free technical advice and assistance on productivity improvement to micro, small, and medium enterprises (MSMEs) through the conduct of orientation, training,  and provision of technical advice.

According to her, the NWPC also conducts the National Productivity Olympics, a biennial national competition of the best productivity improvement programs among MSMEs.

The National Productivity Olympics is a productivity promotion program that recognizes the importance of PIPs to improve the performance and enhance competitiveness of enterprises.

The other day, Baldoz announced the conduct of the National Productivity Olympics this October.

“Our RTWPBs have adopted a value chain approach in the delivery of productivity training programs to ensure industry- or sector-wide improvements in productivity performance. Some of these training programs are on ISTIV-PAP, ISTIV-Bayanihan, 5S, Service Quality (SQ) and Green Productivity,” Baldoz said, adding:

“All of these are in support of our country’s bid to improve its global competitiveness ranking.”


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