Bleeding the supposed ‘bosses,’ the working masses, dry


MANILA – In 2012, the incomes of the Filipino working population shrunk further compared to the rising cost of living, their recorded productivity and, based on news reports, growing revenues of companies. Considering that 2012 precedes an election year, the Aquino government only responded to decade-long calls of organized labor for a significant, nationwide wage hike with erroneous computations, and policies and pronouncements which labor groups decried as misleading and downright anti-worker.

These policies are top billed this year by the labor department’s supposed improvement or adjustment to regionalized wage-setting– the two-tier wage system — and its supposed guard against illegal labor-only contracting, the Department Order 18-A Series of 2011, which continued a similar order legalizing contractual employment. These two form part of what the progressive labor center Kilusang Mayo Uno (KMU) criticizes as “cheap labor policy.” Taken together, these combine to either freeze wages at current levels or worse, diminish the wages further.

Unionists protesting in front of labor department in Manila, Sept 2012 (Bulatlat File Photo /

Among others, the KMU said these were on top of previous government policies against labor such as (a) Article 2636 of the Labor Code, which grants the Labor Secretary the power to assume jurisdiction over labor disputes, and (b) DO 57-04, which enforces the “self-assessment” of companies with regard to workers’ occupational health and safety.

Instead of doing the opposite of Macapagal-Arroyo’s government as it had promised voters in 2010, the Aquino government responded to people’s calls for reforms alá-Arroyo, adding its own brand of craftiness in the process. Arroyo kept a tough image; Aquino projected a smiling, seemingly affable leader. His policies are anything but that, though, according to organized labor as they tried to expose Aquino’s ruses, such as in the following:

Wage cuts within a supposed wage hike package

In 2012 as in the past years, various researches attested to the fact that wages in the Philippines are extremely low. The International Labor Organization Global Wage Report 2012-2013, released this month, is just the latest. It says that a worker in the manufacturing sector in the Philippines took home US$ 1.40 for every hour worked, compared to US$ 5.50 in Brazil, US$ 13 in Greece, US$ 23.30 in the United States and almost US$ 35 in Denmark.

In 2012, according to the Philippine labor department, the legally mandated Filipino minimum wages per day range from US$4.62 to US$11.08 (or less than a dollar per hour). Labor groups decried the “very paltry increases” in wages this year, considering that every peso of a worker’s income has shrunk from P0.83 in 2010 to P0.76 this year. That is on top of the P24 ($0.56) drop in real value of their wages from 2001 to 2010, even counting past wage increases, according to a study of Ibon Foundation.

To dodge calls for a substantial wage hike and still look good to voters, the Aquino government habitually compares wages in the Philippines with wages in few countries with lower wages, KMU chairman Elmer “Bong” Labog observed. He explained: “That’s because the Aquino government wants Filipino workers’ wages to be ‘globally competitive,’ (so) it is impoverishing workers even more.” In inviting foreign investors into the Philippines, the Department of Trade and Industry promotes Filipino labor as “cost efficient in terms of wages over labor standard expectations and low operational cost.”

The average wage received by Filipino workers for every hour worked in 2010 was not far from corresponding amounts received by workers in China ($1.36 in 2008) and India ($1.17 in 2007), based on the ILO report. But just comparing their wage rates tell little about their different purchasing power in their home countries. In China, workers’ families can buy their staple food, coffee, sugar, milk, detergent, cigarette, etc., in bigger bulk, and not in tiny retail packs as in the Philippines, noted Fred Engst, an American writer who lived and worked for decades in China, during a forum in Manila this year. That goods and some services (like phone call cards, electricity) can only be bought when retailed in tinier packs, as marketing experts in the Philippines affirm, tell much about the weak purchasing power of many Filipino families.

Under Aquino, such diminishing purchasing power shows little prospect of improving. As his government began implementing a new wage system this year, a two-tier wage system, it sets a new, lower mandatory wage compared to current minimum wage (except in the capital where for 2012, at least, the “floor wage” and the minimum wage are the same).

At the same time, Aquino’s new wage system further diffuses wage hike setting, from per region and per area (as the law on wage rationalization prescribes), to also per firm level. It is feared the system will further pull down the wages, as progressive labor groups said the more than two decades of regionalized wage setting have done on their wages.

The ILO’s latest Global Wage Report shows also that the growth of real wages in developing countries has remained smaller than before the 2008 global financial and economic crisis. It also showed that workers are getting a tinier portion of companies’ incomes, which go mostly to profits, including shareholders’ dividends.

Since the 2008 global economic crisis, many of the world’s top companies have already reported profits, due to their more intense exploitation of workers, although they call it by different names. (Fortune magazine calls this ‘an explosion in labor productivity.’ Or, “how well most companies have fared by pushing workers to create more value with fewer resources.”)

A report on America’s 500 biggest companies, released by Fortune Magazine middle of this year, described last year as “the year of living profitably.” It notes that their biggest companies produced more at little new cost, “garnering exceptional returns on their capital” via “productivity gains and globalization.” Doing more business in “developing economies,” which include the Philippines, big American companies implemented brutal layoffs in their home countries and granted an average wage raise of only two-percent by 2011, while their profits per worker have risen to 50-percent above the level in early 2000s.

In the Philippines, the Aquino government further puts its labor force at the disposal of such global companies coming in search of cheaper wages. Aside from continuing the Labor Export Policy (LEP), the Aquino government gives numerous perks for export-oriented businesses and business process outsourcing (BPO) sector, and ‘wage freezes’ or “the refusal to give decent wage hikes to workers,” as the KMU noted.

“The Philippines should not go along with this global trend (paying workers meager wages while companies rake it in). That’s why we workers are pressing for a significant wage hike,” Labog said. This year, various labor groups have also formed a new alliance called ACT2Win to press for legislated wage hike, and to urge government to put an end to wage-cutting contractualization schemes.

Speaking democracy while constricting rights

Based on reports, Aquino, like Arroyo, includes in his administration’s counter-insurgency campaign the surveillance and harassment of labor unionists, labor leaders and labor organizers especially from the progressive bloc. Accusations that they support or join the communist New Peoples’ Army are used as justifications for vilifying, arresting and jailing unionists and organizers. There were also cases of extra-judicially killed labor unionists, leaders or organizers.

Southern Tagalog workers in a rally in front of labor department, Sept 2012. (Photo by Marya Salamat /

The year saw the implementation of “DOLE-DILG-PNP-DND-AFP Joint Guidelines on the Conduct of the AFP/PNP Relative to the Exercise of Workers’ Right to Freedom of Association, Collective Bargaining, Concerted Actions and other Trade-union Activities” which allows the military to interfere in labor disputes. On top of these, workers usually encounter various legal and regulatory constraints in forming and maintaining unions, initiating and concluding collective bargaining negotiations and in launching strikes.

Under Aquino, the trend of fewer new unions hurdling constraints to registering with the labor department continues. In 2009, or the year before the 2010 elections, some 384 new unions managed to get registered. But after Aquino took the helm, new unions registered slid to 335 in 2010, and 297 in 2011.

As in years under Arroyo, the dwindling number of registered unions is not due to workers’ lack of interest or effort. The unionists of hardware supplier Co Ban Kiat and radio workers RMN-Manila were some of this year’s examples that workers continue to form unions. On the way toward registration and start of collective bargaining negotiations, new and even old unions were set back, at times decimated, by suspension or layoff of its officers and active members.

Progressive union leaders told the total number of existing or registered unions with the labor department may not be wholly reliable, as many registered unions have faced dissolution or emasculation because of government-supported contractualization policy. As of this writing, Philsteel workers union in Southern Tagalog, and 3MR Decors in the capital, are on strike against mass termination and their firm’s apparent runaway shop.

Some unionists also told they spend a long time and effort to file complaints with the National Labor Relations Commission and Court of Appeals and up to the Supreme Court, against attacks on them by the management. The quest for redress took years, they said. But winning their cases against, say, illegal termination, is still no assurance they would enjoy its benefits immediately. As in the case of the bus workers from the now defunct Times Transportation and Pantranco, they still have to continue their campaign for job reinstatement and/or backpay and separation/retirement pay.

The labor department congratulates itself on maintaining a single-digit strike incidence for the last six years, but this year, the KMU said they recorded at least 12 cases of strike. “Aquino cannot claim that the situation of the country’s workers is improving. In fact, despite the existence of repressive policies, workers across the country have been forming unions and launching strikes,” Labog said.

“Aquino’s mantra of ‘industrial peace’ is not about addressing the causes of workers’ protests, but of repressing these protests. Aquino is no better than Arroyo, and the plight of the country’s workers and poor is the clearest proof,” he added. For most progressive unionists, the lack of recorded strike and the dwindling number of formally registered unions are not something a labor secretary should be proud of, if it were after democracy and supposed inclusive growth.

The use of assumption of jurisdiction and compulsory arbitration has been bitterly criticized by organized labor who said it served as “license to kill,” literally and figuratively.

Since Arroyo, the government’s use of power to intervene in labor disputes had consistently exceeded the number of actual strikes recorded, suggesting that it had indeed been actively used to preempt potential strikes. It apparently continued under Aquino. As of October this year, Labor Secretary Rosalinda Baldoz used her power to intervene in labor disputes in at least 12 cases, or four times the recorded actual strikes she had mentioned in her statement at the time.

On Human Rights Day, unionists from Southern Tagalog marched to the main office of the labor department and threw red paint on its façade, to underscore what they call as “bloody record” of the department. They were blocked and manhandled by the police before they managed to spill red ink on the labor department’s pavement.

Hyping growth amidst continued poverty

Progressive labor groups and youth groups in 2012 also consistently criticized the lack of a national industrialization drive in the Aquino government’s economic policy. They ascribe to it the Philippine government’s ‘job-generation strategy’ premised on offering foreign investors what progressive labor groups call as cheap and repressed labor.

The youth group Anakbayan said the Aquino administration’s failure to generate enough job opportunities proves that its economic policies are inefficient.

Despite efforts to bring down the workers’ wages, unions and strikes in order to attract more investors, job generation hardly coped with the number of people needing jobs. Even government data showed that since Aquino took power, and despite his much vaunted rosy economic outlook, the seven-percent unemployment rate in July 2010 remains in July 2012, plus, there are more underemployed Filipinos this year (22.7-percent) than during his first month (17.9-percent), when he promised the Filipinos they can start dreaming again.

When Baldoz boasted of the increased number of temporary and low-paying jobs this December, due to the holidays, the KMU slammed it as another proof of Aquino’s failure at providing decent employment. It is “scraping the barrel, maximizing the smallest positive signs in the country’s bleak employment situation for propaganda purposes,” Elmer “Bong” Labog, KMU chairman, said in a statement.

The truth is, there is chronic unemployment problem in the Philippines, the KMU said. The youth feel it most, as unemployment rate among the 15 to 24 years old are more than twice the national rate, even using the government data.

The workers and the youth questioned the practical value in Filipino lives of Aquino’s vaunted 7.1-percent economic growth in the last quarter, saying that this had not been felt by most Filipinos. In fact, even analysts from the labor department admit the “Economic growth in the past decade (2001-2010) has not translated to equivalent improvement in employment levels.” Yet, Aquino is simply continuing, in more intense manner, the job generation approaches of past governments.

“The Aquino government persists in attracting foreign investors, its main approach to generating jobs in the country, and is trying to prettify this approach by hyping what it sees as minor improvements,” Labog said.

“To attract foreign investors, the government has been offering cheap and repressed labor. This approach has failed to generate sufficient employment for Filipinos and has merely caused greater poverty and hunger among workers,” Labog added. The labor leader forecasted that “Unemployment will surely rise in the first months of 2013. While economic activity related to the 2013 elections may slightly increase employment a few months before the elections, the employment situation in the country remains fundamentally bleak.”

Anakbayan said it was very “misleading” of the Aquino government to feed the people news of excellent growth in GDP, while not showing how the ordinary Filipino benefits from the said growth.

“Do they think the people are dumb? They are trying to fool us into thinking that they have done agood job, when wealth and opportunity remain poorly distributed across the population,” said Vencer Crisostomo, chairman of Anakbayan.

The youth group rejects what they see as “Aquino’s answer to unemployment,” the K to 12, saying the program will only reinforce the idea that Filipinos are merely cheap labor to be exported. Given Aquino’s budget cuts in social services such as education, and the freedom it grants private institutions to raise tuition yearly, Anakbayan says it “makes unemployment possible.”

If the Aquino government “is serious in providing decent employment to all Filipinos, it should implement genuine land reform and nationalist industrialization programs,” Labog of KMU said. But, judging from Aquino’s actions and policies, the labor leader warned that promoting an employment program that is not dependent on foreign investors is farthest from the mind of President Aquino. (

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