Malacañang on Tuesday clarified that the implementation of the P85 daily minimum wage increase for private sector workers in the National Capital Region will proceed as scheduled.

"There is no suspension. No one is halting it. It will be implemented," Palace Press Officer Undersecretary Claire Castro said in Filipino during a Palace briefing.

Castro also said the Palace has not received any request from private sector groups seeking the suspension or reconsideration of the wage increase.

"Wala pong naipaabot sa atin kung may nag-request mula sa private sector, pero wala pong utos na ito po ay i-suspend," she said.

Her remarks came after the Foundation for Economic Freedom (FEF) urged the government to suspend the implementation of the wage order, warning of possible adverse effects on businesses and the economy.

The FEF said the P85 increase significantly exceeds productivity growth and inflation, arguing that businesses may pass higher labor costs on to consumers through increased prices of basic goods.

The group also warned that micro, small and medium enterprises would be among the hardest hit.

"Unlike large conglomerates, MSMEs operate on paper-thin margins and lack the capital cushions to absorb a sudden spike in overhead costs. Forcing these businesses to shoulder higher labor costs under these volatile conditions will push many to the brink of insolvency, resulting in widespread layoffs, reduced working hours or even complete business closures," the FEF said.

Under Wage Order No. NCR-27, the P85 daily minimum wage increase will be implemented in two tranches. The first P60 increase takes effect on 25 July, while the remaining P25 will be implemented on 20 January 2027.