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8 Nagkaisa Labor Day Demands:

Labor groups asks BIR to enhance fringe benefits & minimum wage tax exempt for workers for Labor Day

April 14, 2014

QUEZON CITY – A coalition of labor groups called Nagkaisa had asked the Bureau of Internal Revenue (BIR) Commissioner Kim Henares to approve their proposal to enhance the current fringe benefits and improve taxes on minimum wage received by employees as part of Aquino administration overtures for workers on May 1 Labor day.

Trade Union Congress of the Philippines (TUCP) spokesman Alan Tanjusay said the idea is part the eight issues finalized April 9 between Nagkaisa and select members of the cabinet in a series of dialogues since 2012 for approval of President Aquino on or before the traditional May 1 Labor day breakfast with labor sector in Malacanang Palace. He said the group believed these issues were the agenda in a cabinet meeting with Aquino Friday last week.

Philippine Airlines Employees Association (PALEA) president Gerry Rivera said Nagkaisa is pushing for Henares to impose tax only on the incremental amount of the negotiated minimum wage and not the entire amount itself.

"If union workers, for example, were able to successfully negotiate for a P10 wage increase on top of their minimum of P500 a day, we want only the added P10 to be taxed and not the entire P510," Rivera said adding: "we desire it to be like this in reverence of and to preserve the sanctity of collective bargaining negotiations between the worker and his employer. It's useless to negotiate for a higher wage if the entire amount is taxed."

At the same time, he said the Nagkaisa is also campaigning for BIR to revise the current version of the de minimis fringe benefits enjoyed by unionized or regularized workers.

Not subject to any tax, the de minimis benefits are facilities or privileges given or offered by an employer to its employees but such are relatively small value but offered or given by employers as a means of promoting the workers' health, company goodwill, contentment or efficiency of its employees.

The Nagkaisa proposal is to revise the (1) monetized unused vacation leave credits from the current 10 days to 15 days; (2) retain the monetized value of vacation and sick leave credits paid to government officials and employees; (3) medical cash allowance to dependents from P750 to P1,500 per employee per month; (4) rice subsidy from P1,500 to P2,500 or 1 sack of 50kg of rice per month; (5) uniform and clothing allowance from P4,000 to P6,000 per year; (6) actual medical assistance – e.g. medical allowance to cover medical and healthcare needs, annual medical executive check-up, maternity assistance and routine consultation from P10,000 to P15,000; (7) laundry allowance from P300 to P900; (8) employees achievement awards in the form of tangible personal property other than cash gift or gift certificate with annual value not exceeding P10,000 to P15,000; (9) gifts given during Christmas and major anniversary celebrations from P5,000 to P10,000 per year per employee; and (10) daily meal allowance for overtime work and night/graveyard shift from 25% to 34% of the basic minimum wage per region.

"If the proposed revisions are approved by BIR, it will encourage more employers to provide fringe benefits to their employees. On one hand, the employees will be happy. And if employees are happy, then they will be more productive and loyal to the company," said Sonny Matula, president of the Federation of Free Workers (FFW).

Bukluran ng Manggagawang Pilipino (BMP) president Leody de Guzman, said that apart from enhancement of tax exemptions, the Nagkaisa is also pressuring for Aquino to criminalize and eliminate contractualization of labor, enhance labor rights by deterring union-busting and actively prosecute extrajudicial killings of labor organizers and journalists, institutionalize core labor standards in the agro-industrial plan, address affordability and supply sufficiency of power, reform key provisions of EPIRA law, labor representation in the Energy Regulatory Commission (ERC), provide affordable housing program and non-violent transfer of urban poor communities from danger zones, ratification of ILO Convention 151 – a convention concerning protection of the right to organize and procedures for determining conditions for employment in the government service, approve into law the Freedom of Information measure and ensure a jobs-led and workers' sector participation in the planning and implementation of programs of the rehabilitation and reconstruction of Yolanda-hit areas.

Aside from the TUCP, some of the more than 40 other members of the Nagkaisa coalition is the Associated Labor Unions (ALU), Sentro, Alliance of Progressive Labor (APL), Partido Manggagawa (PM), Federation of Free Workers (FFW), Public Services Labor Independent Confederation (PSLINK), Bukluran ng Manggagawang Pilipino (BMP), Philippine Government Employees Association (PGEA), Association of Genuine Labor Organizations (AGLO), Kilusan ng Maralitang Obrero (KAMAO), Confederation of Independent Unions (CIU), Philippine Airlines Employee Association (PALEA).