Gov’t to shoulder P60 wage hike for struggling SMEs

The government will temporarily shoulder the P60 daily wage increase for workers of qualified small and medium enterprises struggling to absorb the higher labor cost, Malacañang said Monday.

Palace Press Officer Claire Castro said the Department of Labor and Employment is rolling out the Sagip Trabaho Program, under which the government will cover the additional P60 wage for eligible businesses for three months, from October to December.

The assistance is intended to prevent companies from laying off workers or closing while adjusting to the higher minimum wage, Castro said during a Palace briefing. 

Labor Secretary Francis Tolentino separately said DOLE would shoulder the wage difference for qualified establishments that cannot immediately afford the increase.

“The DOLE will be paying for the difference,” Tolentino said in Filipino during a radio interview Monday.

He estimated that a small establishment could receive close to P140,000 in assistance depending on its workforce. The subsidy will run for 90 days, with the department expected to issue guidelines governing qualification and implementation. 

P60 hike now in effect

The assistance comes after a P60 increase in Metro Manila’s daily minimum wage took effect on 26 September under Wage Order No. NCR-28.

The new rate raises the minimum daily wage for non-agricultural workers from P695 to P755.

Workers in agriculture, service and retail establishments employing 15 workers or fewer, and manufacturing establishments regularly employing fewer than 10 workers now receive at least P718 per day, up from P658.

About 1.1 million minimum wage earners are expected to benefit from the adjustment, according to DOLE.

Qualified businesses that remain unable to absorb the increase may also apply for an exemption. Tolentino said establishments will have 75 days to file applications and will be required to submit documents such as financial records and Department of Trade and Industry certifications. 

The exemption mechanism is separate from Sagip Trabaho, which is designed to allow workers to receive the wage increase while providing temporary government support to employers.

DOLE earlier issued nationwide guidelines strengthening enforcement of wage orders while providing support mechanisms for micro, small and medium enterprises facing difficulty complying with mandated increases.

Assistance expands beyond NCR

Tolentino said Sagip Trabaho would also cover qualified businesses in Central Visayas, where a P42 daily minimum wage increase is scheduled to take effect on 14 October.

The Central Visayas adjustment will raise daily minimum wages to P582 in Class A areas and P542 in Class B areas. More than 300,000 minimum wage earners are expected to benefit. 

Castro said the government wants the wage adjustment to improve workers’ income without forcing vulnerable businesses to shed jobs.

Alongside Sagip Trabaho, DOLE is preparing business continuity and worker performance measures aimed at helping participating establishments remain operational throughout the subsidy period.