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2017 labor day state of workers

Government, employers ignore workers’ slide to poverty, inequality

By Associated Labor Unions (ALU)
May 1, 2017

DAVAO CITY – The country’s biggest labor organization, the Associated Labor Unions (ALU) warned of uprising among the working poor as means to be freed from misery if government and employers continue to ignore worsening poverty and inter-generational inequality caused by joblessness, inadequate wages, insufficient social protection benefits and precarious short-term work arrangement.

“We have been witness to recent series of events where our poorest poor people were forced to raid rice warehouses, invade government housing units and claim ownership to lands that they felt was deprived from them. We do not condone nor tolerate these illegal actions but we attribute these series of lawlessness as symptoms of an irresponsive government and inhumane employers and capitalists,” said Alan Tanjusay.

Diminishing value of wage vs. rising inflation

Despite of the country’s consistent economic growth, the purchasing power of daily minimum wage fell significantly in the face of 3.4% inflation rate registered in March 2017.

In a monitoring made by ALU, the purchasing power, for example, of P491 daily minimum wage in the National Capital Region fell to P361 in February 2017. While the average purchasing power of daily minimum wages in regions outside NCR is P250 a day.

These rates are considered way below the 2015 standard poverty level of P393 required amount needed by a family of five for food and non-food needs to survive in a day.

“This condition needs immediate response from government and employers. Workers are now desperate and if this is met inaction many will resort desperate means to survive,” Tanjusay said.

Tanjusay cited incidents in April last year where 300 farmers attempted to ransack a rice warehouse, the recent invasion of government housing units in Bulacan by hundreds informal settler families and last week’s invasion of a portion of Hacienda Luisita in Tarlac by landless farmers.


To back up his claims on growing poverty, Tanjusay cited the result of survey a few days ago by the Social Weather Station (SWS) estimating there are 11.5 million families or 69 million individuals who said they are impoverished compared to 10 million families or 60 million individuals in December 2016.

With a vast amount of wealth generated by a consistently growing economy, why does millions of families still feel deprived? Where does the money go?

Aside from 40 families of oligarchs still controlling the economy, Tanjusay specifically identified the drivers of poverty among workers and their families. These are growing unemployment, underemployment, and meager social amelioration benefits.

He said the drivers of poverty among working poor are the growing unemployment, widening underemployment driven by inadequate wages, precarious contractualization short-term contractual work arrangement, jobs-skills mismatch, inadequate social insurance, worsening traffic congestion and fire-prone workplaces.


Government’s Labor Force Survey released on March 14 this year, 39.4 million Filipinos are employed, out of which are 2.8 million without jobs while 6.4 million are underemployed of the total 69.4 million workforce as of January 2017.

“With only a few families controlling the economy, our government institution should function according to their mandates and enforce our laws and implement programs to make the money trickle down to benefit workers who helped built that wealth. But these are dysfunctional.

“Analyzing these numbers, the cause of concern out of this survey is not just on those jobless but we are monitoring the behavior of the underemployed as well or those who have jobs yet their income is inadequate to meet their needs,” Tanjusay said.

Causes of unemployment and underemployment

He identified the causes of unemployment and underemployment as contractualization, jobs-skills mismatch, low minimum wage, rising prices of goods and cost of services, diminishing purchasing power of meager minimum wage and lack of jobs-creating investments due to expensive electricity, water and transportation cost, expensive but poor telecommunication and internet services.

Workers productivity at work and quality time at home are also hounded by tardiness, fatigue, stress, caused by worsening traffic congestion and poor mass transport system and inadequate and aging infrastructures such as airports, seaports, container ports, railways, roads and bridges.

The ALU also attributes unemployment and underemployment to high cost of doing business imposed by local government units, judicial proceedings, and government red tape, illegal smuggling, occupational safety and health, tedious labor cases, and meager social protection coverage including low pension benefit, rising crime incidents, and continuing peace and order problems.

Contractualization and wage

The issue of temporary contractualization work arrangement are among the top priorities when labor groups meets with Duterte in a Mayday dialogue with labor groups including ALU, Trade Union Congress of the Philippines (TUCP) and labor coalition Nagkaisa to be held 3p.m. today at People’s Park in Davao City.

“These challenges are brimming burden for workers. But organized labor groups prioritized the order of battle by concentrating their energy on the issue of raising wages to cope rising cost of living and ensuring workers have security of tenure by banning contractualization and all fixed-term employment because they need to survive and cope with rising cost of living not just for today but the days after,” Tanjusay said.

The unions fight to eradicate contractualization is even made difficult with many elected executive and legislative government officials through dummies are engaged in the business of manpower service providers in constantly providing workers to companies and locators in their areas of jurisdictions.

“This racket is working for both the politicians and business owners. This is profit and secured votes for politicians in exchange of no delays in permits to operate and for them turning blind eye on employers’ non-compliance to local labor ordinances and standards including general labor standards and occupational safety and health standards,” Tanjusay said.

Kentex and HTI fires

Seventy four workers perished in May 2015 Kentex factory fire while five workers were burned to death in HTI fire incident in February this year. These fatal incidents could have been prevented had there been routine local level inspections before the issuance of permits to operate.

May 1, 2017 dialogue agenda

Aside from the contractualization and wage issues, there are ten other issues that they expect action from Duterte in today’s dialogue.

The ALU and Nagkaisa labor coalition have grounds to anticipate that Duterte would also certify House Bill 4444, an Act to Strengthen Security of Tenure sponsored by TUCP Party-list Rep. Raymond Mendoza as urgent administration measure. House Bill 4444 shall prohibit all forms of fixed term employment and criminalizes its violation.

Workers also requested the Duterte approval of International Labour Organization Convention 151 which empowers government workers to organize and create their own associations and unions; resolve once and for all the five-years-and-running dispute on outsourcing between Philippine Airlines and PAL Employees Association.

Labor groups also requested for the creation of a tripartite commission to review and revise guidelines on wage setting, ensure genuine labor representation to government tripartite bodies, establish a reform of power policy that will assure security of supply of electricity and its affordability to make our economy competitive.

They also seek Duterte approval of deputization of trade unions in the inspection of workplaces, regularize quarterly dialogue with labor groups, issue an order prohibiting the collection of recruitment and placement fees, and assign help desk where trade unions can report rogue cops who are using the crack down on illegal drugs as a camouflage in union-busting.

Emergency subsidy

The ALU proposed Duterte to provide through a P500 monthly subsidy for workers to cope with the rising cost of living. The proposal is called Emergency Labor Empowerment and Assistance Program of the Office of the President, Department of Labor and Employment (DOLE) and accredited trade unions.

Under the proposal, the Office of the President may initially appropriate and provide the subsidy amount with the DOLE as lead implementing agency with trade unions as conduit of the program in distributing cash vouchers after beneficiaries attended workers’ orientation on fundamental workers’ rights.

Forthcoming labor problems

Aside from ongoing challenges and problems facing workers, the ALU anticipate the influx of foreign workers to fill the shortage of skilled and professional workers due to the continuing flight of Filipino workers to work abroad in search of better wage and higher benefits and the possible uptick demand for more workers in the light of mega-infrastructure programs envisioned by Duterte administration’s ‘Dutertenomics” and ‘build, build, build’.

Climate change

The ALU also identify climate change events as significant factor that impact workers. The devastation caused by El Niño and La Niña phenomenon not only threatens the life and limbs of working people but also displaces and breaks livelihood patterns.

“Extreme weather events are catastrophic to all Filipino. The sum effect is if workers are able to survive these events, they are unsure if they still have jobs and means of livelihood when their factories and offices are destroyed by natural forces,” Tanjusay said.

He cited the post-Yolanda havoc and the recent decision of the government to shut down mining companies.

Decreasing union density

The narrative of workers struggle for decent work and shared prosperity in globalization age is made difficult by waning power if unionism.

The Bureau of Labor Relations of the DOLE estimated there are around 2.1 million workers registered as members of the union and only around 200,000 of which are covered by Collective Bargaining Agreements (CBA) as of December 2016, down from 4 million unionized workers and 400,000 covered by CBA in 2010.

Bright prospects

However, amid the brimming natural and man-made woes confronting workers, there are bright prospects that would somehow slow down the downward trend of unemployment and underemployment and mitigate its negative impacts to the labor force.

Tanjusay said the government’s completion and operationalization of mass railway and utility bus system and the establishment of a national broadband nationwide spur direct employment in the construction and information, communication and technology sector.

Impending tax refund

The Bureau of Internal Revenue (BIR) owes each 600,000 minimum-waged workers nationwide with an estimated P9,000 “blood money” from the tax they collected for six months in 2008 amid a law exempting the workers from withholding tax.

In its decision released on February this year, the Supreme Court said minimum wage earners (MWEs) should not taxed because they are exempted from doing so by Republic Act 9502 – the law giving exemption to minimum waged workers from monthly salary tax deductions. The law became effective June 17, 2008. However, the BIR issued Revenue Regulation 10-2008 and only exempted MWEs six months later.

Tanjusay said they expect the Supreme Court finally decide on the manner of refund before the end of the year.

Compliance and enforcement

These challenges needs radical government interventions and serious reforms in the hearts and minds of employers and capitalists.

“The Associated Labor Unions is urging the government to consistently enforce labor standards and occupational safety and health standards. We call on employers and business-owners to faithfully comply to labor laws and policies,” Tanjusay said.

If these remains unattended, poverty will continue to thrive and breed social problems. Ignoring inequalities will always evolve from one generation to another and create even more problems, he said.