Photo by Patrick Adalin |
The labor group Partido Manggagawa
asserted that both business and government must act to avert the covid pandemic
turning into a social crisis. This was the group’s reaction to the call by 32
business organizations for deficit spending by government for assistance to
workers and the poor.
“Employers must bear temporary losses by
paying wages to their workers during the lockdown. Businesses should go into
deficit spending just like what they demand of government,” stated Rene
Magtubo.
To illustate, he added that “We know of
a parts supplier to car companies abroad that stopped operating this week without
granting quarantine subsidy to more than 8,000 workforce and instead is applying
for the P5,000 DOLE assistance to formal workers. This is a giant company that
can very well afford to bear losses by paying wages during the lockdown.”
“Big businesses that employ more than 200
workers should be mandated to grant quarantine subsidy to its workers. These
large establishments employ more than a third of all formal workers.”
According to PM, even micro, small and
medium enterprises can shoulder temporary losses by paying quarantine subsidy
to their workers. A microenterprise with 5 workers and P1.5 million in
capitalization—the median numbers for the category—will incur P50,000 in
quarantine subdidy for one month which translates to losses since there is no
revenue. This P50,000 temporary loss is still just 3.3% of its total
capitalization and should not lead to bankruptcy. These microenterprises number
850,000 and employ almost a third of all formal workers.
Magtubo explained that “For a median small
enterprise with P7.5 million in capitalization and employing 50 workers,
shouldering the quarantine subsidy of P10,000 in one month translates to a loss
of 6.7% of their capital, which is still manageable.”
“But, assuming for the sake of argument that
the SMSE sector is precisely what the government should assist, then the P5,000
DOLE assistance is wanting and must be raised to P10,000. This is what should
be funded from the P280 billion in stimulus that business is proposing,” Magtubo
insisted.
He furthered that “However this imply
that large enterprises must take the cudgels for their own workers. But at
present they are not doing that. So they must be compelled by a government
order mandating that big firms pay quarantine subsidy to their workers. Employers
have benefited from more than a decade of economic growth without sharing the
bounty with their workers whose real wages have stagnated. Now that there is a crisis, employers are morally
obliged not to pass on the burden to their hapless workers.”
March 21, 2020
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