Press Release
July 22, 2020

Villanueva asks DOLE to clarify rules on wage reduction to stop abuse on workers

Senator Joel Villanueva has asked the Department of Labor and Employment (DOLE) to clarify Labor Advisory No. 17, which it issued in May on the resumption of business operations, saying that the guidance on wage and wage-related benefits are apparently abused by some employers.

In a letter to Labor Secretary Silvestre Bello III, Villanueva said his office has been receiving reports from workers whose employers implemented wage reduction schemes contrary to what the advisory required.

"Sa ilalim po ng labor advisory, pinapayagan po ang pagpapatupad ng wage reduction scheme sa mga kumpanya. Ngunit, malinaw po ang panuntunan na kailangan pumayag ng kusang-loob ang mga manggagawa sa ipapatupad na wage reduction ng kumpanya. Kailangan po magkasundo ang employer at manggagawa sa wage reduction scheme," Villanueva said in a statement.

"Ngunit sa kasamaang palad, marami na pong natatanggap na mga ulat ang ating opisina mula sa mga manggagawa na pinagbabantaan sila na tatanggalin sa trabaho kapag hindi sila pumayag sa wage reduction scheme," the lawmaker continued. "Ang ibang manggagawa naman, sapilitan na lamang po tinanggap ang wage reduction scheme ng walang kasulatan."

The lawmaker, who chairs the Senate labor committee, raised the need to have a "clear grievance mechanism" in Labor Advisory No. 17 where workers could seek redress over perceived irregularities in the implementation of a wage reduction scheme as stated in the guidelines.

"The absence of a clear grievance mechanism in Labor Advisory No. 17 has exacerbated the affected workers' feeling of helplessness, especially in a time of massive economic and health crisis," Villanueva said. "Thus, we are respectfully calling on the Department to immediately issue a clarificatory issuance on the grievance mechanism that workers may resort to in cases where they feel that their agreement to the wage reduction scheme adopted by their employer was not properly sought or coerced."

Villanueva also suggested that DOLE implement a reporting requirement for employers who would implement wage reduction schemes as a safeguard for employees and reduce opportunities for abuse.

"Some workers have pointed out that the non-imposition of the notice requirement increases the possibility of abuse, especially since the Department has very little, if at all, visibility on the number and extent of wage reductions being implemented by the employers," Villanueva said. "Thus, we are also calling on the Department to require employers to notify the Department of the wage reduction schemes they have adopted, the number of workers affected, the extent of such reduction, and the duration of such arrangements, among others."

The advisory, which DOLE issued on May 18, stated that employers and employees "may agree voluntarily and in writing to temporarily adjust employees' "wage and wage-related benefits" specified in existing employment contracts, company policy or collective bargaining agreement.

The wage reduction agreement should not exceed "six months or the period agreed upon in the collective bargaining agreement. After such period, employers and employees shall review their agreement and renew the same."

Villanueva likewise credited DOLE for its continuous efforts to provide assistance to all workers despite its limited resources.

He underscored the department's crucial role "in providing emergency aid to affected workers, but also in ensuring that there are available jobs and qualified workers to address the needs of the job market."

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