The Department of Labor and Employment (DOLE) stressed the need to evaluate the impact of the proposed bill requiring private sector employers to pay 14-month pay to ensure it does not lead to imbalance between the needs of labor and the capability of employers.
Labor secretary Silvestre H. Bello III pointed out that the department backs any legislation that benefits workers and their families, but showed reservations towards the proposed bill filed by Senate president Vicente Sotto III on July 1, which will cover all private sector companies, including micro, small and medium enterprises (MSMEs).
The Trade Union Congress of the Philippines said the bill will help supplement the insufficient income of workers. However, employers warned that it will result in a spike in inflation and the country will lose its competitiveness against its Southeast Asian peers. Sergio R. Ortiz-Luis Jr., president of the Employers Confederation of the Philippines, also said it could harm MSMEs, which will be forced to either increase the prices of their products or cut jobs to shoulder higher labor costs.