The Philippine Chamber of Commerce and Industry (PCCI), whose members are largely micro, small and medium enterprises, raised concern over the approval of a legislated P200 minimum daily wage hike.
On June 4, 2025, the House of Representatives has passed on third and final reading House Bill No. 11376, or the Wage Hike for Minimum Wage Workers Act, which proposes a P200 minimum wage increase for private sector workers, whether they are regular employees or not. If enacted into law, this could be the first legislated wage hike in more than three decades.
Foremost, PCCI President Eunina Mangio said the legislative action was done without consideration to the impact it will have on the economy – on the price of goods and services, on those working in the informal sector who account for about 50-60 percent of the population, and on the micro and small enterprises (MSEs) that comprise 96 percent of the total number of enterprises in the country.
“The wage hike leads to higher labor costs, consequently resulting to higher costs of goods and services, and inflation,” Mangio said in a statement.
Even as the benefit will only be enjoyed by workers in the formal sector, Mangio said, the inflationary effect will erode purchasing power negating the wage hike’s intended benefit. “This will bear down more on workers in the informal sector who are not bound by the minimum wage law,” she said.
Mangio warned that increased operational expense lends the risk of closure of smaller enterprises, reducing further the number of jobs in the formal sector.
Secondly, PCCI said the unilateral wage hike sets a precedent that undermines the Regional Wages and Productivity Board (RWPB), which was created primarily with the function to determine and set region-specific wages based on the local cost of living.
Under the RWPB, the setting of minimum wages takes into account the differences in the cost of living across regions as well as the unique needs of businesses based on specific industry, location, and type of labor they need.
Thus, PCCI said, legislating a single wage for all areas can harm businesses in lower-cost regions and removes the flexibility of the RWBs to set wages that are aligned with the situation in the local areas.
The PCCI expressed hope that the bicameral conference committee will consider the position of the business sector and adopt a comprehensive approach that balances the needs of workers with the capacity of businesses and ensure that MSMEs continue to thrive while still providing fair wages.
