Professional Documents
Culture Documents
FACTS
On October 15, 1990, the Regional Board of NCR issued Wage Order No. NCR-01, increasing
the minimum wage by P17 daily.
The Trade Union Congress of the Philippines (TUCP) and Personnel Management
Ass oc iat ion of t he Phil ippi nes (PMAP ) moved for r econs ider a t ion.
P e t i t i o n e r Employers Confederation of the Philippines (ECOP) opposed.
Board then issued Wage Order No. NCR-01-A, amending the wage order by stating
that all workers and employees in the private sector already receiving wages
above the statutory minimum wage rates up to P125 per day shall also receive the
P17 daily increase.
P e t i t i o n e r E C O P a p p e a l e d t o r e s p o n d e n t N a t i o n a l W a g e s a n d P r o d u c t i v i t
y Commission (NWPC).
NWPC: Appeal dismissed for lack of merit.
Motion for reconsideration denied. Hence, this petition.
ISSUE
:Whether or not respondent NWPC committed grave abuse of discretion.
NO.
REASONING
Petitioner says:
Wage Order No. NCR-01-A is an excess of authority as under RA 6727, the boards
may only prescribe minimum wages, not determine salary ceilings.
RA 6727 is meant to promote collective bargaining as the primary mode
of settling wages, so boards cannot preempt CBAs by establishing ceilings
Boards may only adjust floor wages
Court rules
The Court is inclined to agree with the Government.
The NWPC noted that the determination of wages involved 2 methods: the floor-wage
method and the salary-ceiling method.
Floor-wage method- involves the fixing of a determinate amount that would be added to
the prevailing statutory minimum wage-adopted in earlier wage orders.
Salary-ceiling method- wage adjustment is applied to employees receiving a certain
denominated salary ceiling-used in RAs 6640 and 6727 as well as 11 COLA issuances
The shift is due to the labor4 disputes arising from wage distortions.
The equitable distribution of income and wealth along the imperatives of economic
and social development.
ECOP is of the mistaken impression that RA 6727 leaves labor and management alone to
decide wages.
The Court does not believe RA 6727 is meant to deregulate the relation between labor and
capital for several reasons:
Under RA 6727, the state is interested in seeing the workers receive fair and equitable
wages
The Constitution is primarily a document of social justice and has not fully embraced
the concept of laissez-faire.
The Court cannot give an Act a meaning that will conflict with these basic principles.
The concept of minimum wage is more than a setting of a floor wage to upgrade existing
wages as ECOP believes.
The salary-cap method serves the purpose of RA 6727. Whether or not it is a permanent
policy, of the Board, it is a question that we may only speculate. At the moment, it is a
reasonable policy.