CHAPTER 6: WAGES Flashcards
WAGES
Remuneration given to workers in exchange for services.
WAGES
WAGE VS SALARY
Wages are variable and depend on work hours or productivity.
Salary is fixed and provides financial stability.
Wage earners often qualify for overtime pay, while salaried employees may have fixed work hours
REAL WAGE VS. MONEY WAGE
Money Wage is the actual amount paid to a worker.
If a worker earns ₱20,000 monthly, this is the money wage regardless of inflation.
Real Wage reflects what that money can buy after adjusting for inflation. Purchasing power of income.
If a worker earns ₱20,000 but inflation reduces the value of money, the real wage may effectively be worth only ₱18,000.
*A salary increase does not always mean higher real wages. If the cost of living rises faster than wages, purchasing power declines.
*Real wage matters more because it determines how much a person can actually afford with their income.
WAGE INEQUALITIES
- Education and Training
- Natural Ability
- Supply of Labor
Terms of Payment
At least once every 2 weeks
Twice a month
Payment shall be directly to the workers.
Exceptions:
Death of Worker
Force Majeure/ Special Circumstances
DIRECT PAYMENT OF WAGES
Decreasing an employee’s base salary associated with reassignment of duties or demotion.
WAGE REDUCTION
It is unlawful for any person to withhold any amount from the wages without worker’s consent.
WITHHOLDING OF WAGES
Every employer shall be jointly and severally liable with his contractorfor the unpaid wages.
CIVIL LIABILITY OF EMPLOYER AND CONTRACTOR
Tasked to conduct continuous studies and develop policies that center on wages.
NATIONAL WAGE PRODUCTIVITY COMMISSION
WAGE RATIONALIZATION ACT
1989, Republict Act No. 6727 which created the National Wages and Productivity Commission (NWPC) and Regional Tripartite Wages and Productivity Boards RTWPB
RTWPB X11 NEW WAG ORDER
(1) P27 - NON-AGRI - P430
(2) P28 - AGRI - P410
(3) P48 - RETAIL/SERVICE-
CRITERIA FOR MINIMUM WAGE FIXING
- The demand for living wages;
- Wage adjustment vis-à-vis the consumer price index;
- The cost of living and changes or increases therein,.
- The needs of workers and their families;
- The need to induce industries to invest in the countryside;
- Improvements in standards of living;
- The prevailing wage levels;
- Fair return of the capital invested and capacity to pay of employers;
- Effects on employment generation and family income; and
- The equitable distribution of income and wealth along the imperatives of economic and social, development.
Established the Regional Tripartite Wages and Productivity Boards (RTWPBs) to set regional minimum wages.
Republic Act No. 6727 (Wage Rationalization Act of 1988)
Known as the Minimum Wage Law
Republic Act 602 of 1951
Referred to as the Wages and Hours Bill
Fair Labor Standards Act of 1938
Wages affect the quality of labor relationships in an organization.
TRUE
CASE STUDY: Planas Commercial and Marcial Cohu vs. National Labor Relations Commission, Alfredo Ofialda, Dioleto Morente, and Rudy Allauigan
Issues:
1. Whether C. Planas Commercial is exempt from the application of the minimum wage law.
Court’s Decision:
The Court hold that exemptions from minimum wage laws must be substantiated by adequate evidence. Petitioners failed to provide evidentiary support for needing less than ten employees and did not show any application for exemption. Consequently, the Court agreed with the lower courts that petitioners are not exempt and are liable for underpayment of wages.
