Normin wage rate below poverty line

TheMonitorMindanaoToday.com | Normin wage rate below poverty line 

By: Uriel Quilinguing

CAGAYAN DE ORO CITY  – Within five months, the daily minimum wage of workers in private establishments in Northern Mindanao would be P485 to P500, a 39-peso increase over current rates as mandated by a new wage order, but business and labor leaders see the amount too little to possibly lift those below the poverty threshold.

This, after the Regional Tripartite Wages and Productivity Board (RTWPB) Region 10 posted online on New Year’s eve the new wage rates as contained in Wage Order No. RX-24 that was affirmed by the National Wages and Productivity Commission (NWPC) on December 22, 2025.

“The increase may not be enough if we compare it to the (family) living wage of about P1,200 (per day) but it is better than none at all,” said Raymundo Talimio, a certified public accountant and immediate past president of the Cagayan de Oro Chamber of Commerce and Industry Foundation, Inc. (Oro Chamber).

He said that on the point of view of employers and business owners the regional wage-setting mechanism is acceptable since never in RTWPB-10’s 36-year history that a P50 or more increase was made in Northern Mindanao, unlike the proposed legislated wage hikes from P100 to P300 which may cause layoffs and business closures.

But Talimio, who has been known for his advocacy on micro, small, and medium enterprises (MSMEs) in the Regional Development Council, said that legislated wage adjustments could have helped narrow the gap between the daily minimum wage and daily family living wage.

Family living wage refers to the amount of family income needed to provide for the cost of living which includes all food and non-food requirements with sufficient allowance for savings and investments for social security.

“Wage increases like P25 + P14 will remain symbolic gestures rather than real pathways out of poverty for Filipino workers,” Cagayan de Oro-based lawyer Proculo Sarmen, legal counsel of the Federation of Free Workers (FFW), said. “We appreciate it, but honestly, it is another consuelo de bobo (fool’s consolation).”

Sarmen said the Constitution speaks of a living wage, yet workers still cannot support a family with today’s minimum pay because regional wage orders had served as instruments to keep workers below the poverty threshold. This, he said, is a failure of governance, not just an economic issue.

POVERTY THRESHOLD

In formulating Wage Order No. RX-24, the RTWPB-10 which is chaired by the regional director of the Department of Labor and Employment (DOLE), one of the data taken into account was the 2023 poverty threshold of P13,873 per month for a family of five which the Philippine Statistics Authority (PSA) released in 2024.

Under Wage Order No. RX-23, the minimum wage rate then that the RTWPB-10 fixed under Wage Category 1 was P461, thus if the employee worked for 26 days, his monthly gross pay would be P11,986 – way below the PSA-computed poverty threshold P13,873 of Northern Mindanao.

The take-home pay would shrink once worker’s monthly salary is being subjected to mandatory deductions for premiums to be remitted to the Social Security System (SSS), Philippine Health Insurance Corporation (PhilHealth), and Home Development Mutual Fund (Pag-IBIG).

This year’s 39-peso increase will take effect in two tranches this year; P25 on January 16, and P14 on May 1, thereby setting new daily minimum rates at P500 for areas under Wage Category 1 and P485 under Wage Category 2. With P500 a day, with no deductions yet, an employee would be receiving P13,000 a month—still short of the P13,873 poverty line PSA estimate in 2021.

‘TIMELY ADJUSTMENT’

As indicated in the RTWPB-10 wage order, the cities of Cagayan de Oro, El Salvador, Gingoog, Iligan, Malaybalay, Ozamiz, and Valencia as well as the first-class municipalities of Jasaan, Lugait, Manolo Fortich, Maramag, Opol, Quezon, Tagoloan, and Villanueva are under the first wage category. Other cities and municipalities, not in the first category, are placed under the second category, including business establishments employing not more than 10.

“We have to make sure there is timely adjustment in minimum wages,” DOLE-10 Regional Director Joffrey Suyao said in a forum on the region’s labor situation that affects no less than 152,000 daily wage earners in the private sector.

Among the indicators in the Northern Mindanao Regional Development Plan 2023-2028 include a 94.6-percent employment rate in 2021 which was about 2.176 million in the labor force, individuals 15 years old and above.

One of the challenges for DOLE-10 was that about 5.4 percent or some 124,000 are underemployed, those whose pay is not commensurate to services rendered and are looking for other jobs. But there were over 397,000 who were jobless that year or an 18.3 percent unemployment rate.

Suyao said they had public hearings on the region’s wage rates early December last year in the cities Ozamiz, Iligan, Malaybalay, and Cagayan de Oro, participated by groups of employers and workers in agriculture, services, and industry sectors.

LEGISLATED WAGE

Meantime, lawmakers in Congress should pursue the proposed legislated wage increase, according to Talimio and this must include a provision that would give protection to employers such as tax credits, subsidies on employer’s share in SSS, PhilHealth, and Pag-IBIG, and low interest-bearing loans so they could comply.

Sarmen, who was formerly with the Associated Labor Union-Trade Union Congress of the Philippines (ALU-TUCP) that proposed a P200 legislated daily wage increase, lamented that  most current legislators “do not truly see public office as public service” because they are influenced by business interests.”

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