TWENTIETH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE 
S. No. 373
of t')f ©■.•rM't.v.T
25 JUL 10 P2 :28
RECEIVED BY:
Introduced by Senator Robinhood Padilla
AN ACT
STRENGTHENING THE PROTECTION OF PRIVATE SECTOR WORKERS BY 
ESTABLISHING A NATIONAL MINIMUM WAGE AND ENHANCING 
PENALTIES FOR NON-COMPLIANCE, AMENDING FOR THE PURPOSE 
PRESIDENTIAL DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS 
THE LABOR CODE OF THE PHILIPPINES
EXPLANATORY NOTE
In 1989, the enactment of Republic Act No. 6727, otherwise known as the Wage 
Rationalization Act, introduced a regionalized wage-setting mechanism in the Philippines. 
This policy replaced the national minimum wage system with a framework wherein 
Regional Tripartite Wages and Productivity Boards (RTWPBs) determine minimum wage 
levels for each region, taking into account economic indicators, cost of living, and 
productivity levels specific to their jurisdictions.
The rationale behind this approach was to ensure that wage rates reflect the 
distinct socio-economic conditions prevailing in different regions of the country. Variations 
in prices of goods and services, as well as levels of productivity, were cited as justifications 
for setting wages on a regional basis, with the aim of striking a balance between the 
welfare of workers and the sustainability of businesses.
However, over the years, this system has revealed significant structural gaps. 
Despite the intent to localize wage adjustments, disparities in income and living conditions 
have persisted, and in some instances, worsened. Data from independent research 
institutions such as the IBON Foundation show that a family of five in the Philippines 
requires an estimated PI,225 per day, or approximately P27,000 per month, to maintain


a decent standard of living. This estimate considers not only basic needs such as food, 
shelter, and water, but also essential expenditures for education, healthcare, and savings.
Across most regions, the prevailing family living wage (FLW) ranges between 
PI,000 to PI,300 per day, with certain areas such as the Eastern Visayas falling slightly 
below this range. In contrast, families in the Bangsamoro Autonomous Region in Muslim 
Mindanao (BARMM) require over P2,000 per day to meet their basic needs. Despite these 
figures, the actual minimum wage rates in most regions fall substantially short of the FLW. 
The situation is particularly concerning in BARMM, where the minimum daily wage stands 
at only P361, the lowest in the country, compared to P645 in Metro Manila, even though 
the cost of living is significantly higher in BARMM.
The Philippine Statistics Authority (PSA) estimates the poverty threshold for a 
family of five at P12,030 per month, a figure that highlights the challenges faced by many 
minimum wage earners, particularly outside the National Capital Region, where wage 
levels frequently fail to meet even the most basic subsistence requirements.
It is also noteworthy that labor productivity in the Philippines has experienced 
substantial growth, with productivity levels across all sectors increasing from P60,342 in 
1991 to P423,408 in 2018, representing an impressive 600% rise. Yet, wage growth has 
failed to keep pace with these productivity gains, contributing to the widening gap 
between workers' incomes and the cost of living.
In light of these realities, it is incumbent upon the State to uphold its constitutional 
obligation to ensure that workers receive a just share in the fruits of production, including 
the right to a living wage. The establishment of a uniform national minimum wage that 
approximates, if not equates to, the prevailing family living wage is a necessary step 
towards achieving equitable income distribution and promoting social justice and 
economic development.
Accordingly, the passage of this proposed measure is earnestly sought.
PADILLA
Senator


TWENTIETH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE
S. No. 373
25 JULIO P2:28
RECEIVED BY;
Introduced by Senator Robinhood Padilla
AN ACT
STRENGTHENING THE PROTECTION OF PRIVATE SECTOR WORKERS BY 
ESTABLISHING A NATIONAL MINIMUM WAGE AND ENHANCING 
PENALTIES FOR NON-COMPLIANCE, AMENDING FOR THE PURPOSE 
PRESIDENTIAL DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS 
THE LABOR CODE OF THE PHILIPPINES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
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Section 1. Short Tide. - This Act shall be known as the "National Minimum
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Wage Act of2025'.
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Sec. 2. Declaration of Policy. - Pursuant to Article XIII, Section 3 of the 1987
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Constitution, which guarantees the rights of workers to security of tenure, humane
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conditions of work, and a living wage, it is hereby declared the policy of the State to
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promote and protect the welfare of workers by ensuring their right to a living wage
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and dignified working conditions.
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In recognition of this constitutional mandate, the State adopts and
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institutionalizes the establishment of a national minimum wage as the primary
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mechanism for setting wage standards for private sector workers across the country.
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This measure seeks to address and progressively eliminate regional wage disparities,
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promote equitable income distribution, and uplift the living standards of workers in all
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regions, in alignment with national economic and social development objectives.


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The legislated national minimum wage shall complement, and in no way
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diminish, existing wage terms and conditions provided under collective bargaining
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agreements and other applicable laws, thereby preserving the rights and benefits
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already enjoyed by workers.
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Sec. 3. Definition of Terms. - The following terms as used in this Act shall be
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defined as follows:
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a. Worker sY\3\\ refer to any person in the employ of another, whether in
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the public sector or private sector, including ambulant, intermittent, rural
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workers and those without definite employers, regardless of their
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employment status, tenure or nature of the agreements or contracts;
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b. Living Wage shall refer to the amount of family income needed to
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provide for the family's food and non-food expenditures with sufficient
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allowance for savings/investments for social security so as to enable the
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family to live and maintain a decent standard of human existence beyond
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mere subsistence level, taking into account all of the family's
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physiological, social and other needs; and
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c. Wage Distortion shall refer to a situation where an increase in prescribed
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wage results in the elimination or severe contraction of intentional
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quantitative differences in wage or salary rates between and among
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employee groups in an establishment as to effectively obliterate the
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distinctions embodied in such wage structure based on skills, length of
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service, or other logical bases of differentiation.
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Sec. 4. Article 99 of Presidential Decree No. 422, or the Labor Code of the
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Philippines, as amended, is amended to read as follows:
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"ART. 99. [Regional] NATIONAL minimum wage[s]. [The] A
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UNIFORM NATIONAL minimum wage [rates] for agricultural and non-
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agricultural SECTORS' employees and workers [in each and every
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region of the] THROUGHOUT THE country shall be [those]
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ESTABLISHED AND prescribed by the [Regional—Tripartite]
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NATIONAL Wages and Productivity Board[s] (NWPB). THE


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NATIONAL MINIMUM WAGE SHALL BE DETERMINED THROUGH 
LEGISLATION ENACTED BY CONGRESS OR, IN THE ABSENCE 
THEREOF, BY AN EXECUTIVE ORDER ISSUED BY THE 
PRESIDENT OF THE PHILIPPINES UPON THE 
RECOMMENDATION OF THE NWPB.
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THE NATIONAL MINIMUM WAGE SHALL BE APPLICABLE TO ALL 
ENTERPRISES OPERATING WITHIN THE TERRITORY OF THE 
REPUBLIC OF THE PHILIPPINES, INCLUDING THOSE LOCATED 
IN SPECIAL ECONOMIC ZONES (SEZS), REGARDLESS OF 
GEOGRAPHICAL LOCATION, SIZE, TYPE OF INDUSTRY, OR 
LEGAL CLASSIFICATION. FOR PURPOSES OF THIS ACT, THE 
NATIONAL MINIMUM WAGE SHALL EQUALLY APPLY TO ALL 
WORKERS, IRRESPECTIVE OF THEIR EMPLOYMENT STATUS, 
INCLUDING CASUAL, SEASONAL, PROJECT-BASED, 
CONTRACTUAL, AND OTHER FORMS OF NON-REGULAR 
EMPLOYMENT, CONSISTENT WITH EXISTING LABOR LAWS 
AND REGULATIONS."
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Sec. 5. Article 120 of the Labor Code, as amended, is amended to read as
follows:
"Art. 120. Creation of National Wages and Productivity [CommissioFi] 
BOARD. There is hereby created a National Wages and Productivity 
[Commission] BOARD, hereinafter referred to as the [Commission] 
BOARD, which shall be attached to the Department of Labor and 
Employment (DOLE) for policy and program coordination."
Sec. 6. Article 121 of the Labor Code, as amended, is amended to read as
follows:
"Art. 121. Powers and functions of the [Commission] BOARD. The 
[Commission] BOARD shall have the following powers and functions:


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a. To act as the national consultative and advisory body to the 
President of the Philippines and Congress on matters relating to 
wages, incomes and productivity;
b. To formulate policies and guidelines on wages, incomes and 
productivity improvement at the enterprise, industry and national 
levels;
c. To prescribe rules and guidelines for the determination of 
appropriate minimum wage and productivity measures at the 
[regional, provincial, or industry] NATIONAL level[s];
d. [To review regional wage levels set by the Regional Tripartite
Wages and Productivity Boards to determine if these are in
accordance with prescribed guidelines and national development
plans] TO FORMULATE, DETERMINE, AND PRESCRIBE 
PERIODIC ADJUSTMENTS TO THE NATIONAL MINIMUM 
WAGE, TAKING INTO ACCOUNT ECONOMIC INDICATORS, 
COST-OF-LIVING CHANGES, PRODUCTIVITY LEVELS, AND 
OTHER RELEVANT FACTORS, TO ENSURE THAT THE 
MINIMUM WAGE REMAINS CONSISTENT WITH THE 
NATIONAL DEVELOPMENT OBJECTIVES;
e. To undertake studies, research and surveys necessary for the 
attainment of its functions and objectives, and to collect and 
compile data and periodically disseminate information on wages 
and productivity and other related information, including, but not 
limited to, employment, cost-of-living, labor costs, investments and 
returns;
f. [To review plans and programs of-the-Re§ional-Tripartitc Wages
and Productivity Boar-ds te-dctcrminc whether these arc consistent
with national-development plans];
g. [To exercise technical and administrative-supervision over the
Regional Tripartite Wages and Predaetivity Boards];


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F. To call, from time to time, a national tripartite conference of 
representatives of government, workers and employers for the 
consideration of measures to promote wage rationalization and 
productivity; and
[(t)] G. To exercise such powers and functions as may be necessary to 
implement this Act.
The [Commission] BOARD shall be composed of the Secretary of Labor 
and Employment as ex-officio chairman, the Director-General of the 
National Economic and Development Authority (NEDA) as ex-officio vice- 
chairman, and two (2) members each from workers' and employers' 
sectors who shall be appointed by the President of the Philippines upon 
recommendation of the Secretary of Labor and Employment to be made 
on the basis of the list of nominees submitted by the workers' and 
employers' sectors, respectively, and who shall serve for a term of five 
(5) years. The Executive Director of the [Commission] BOARD shall also 
be a member of the [Commission] BOARD.
The [Commission] BOARD shall be assisted by a Secretariat to be 
headed by an Executive Director and two (2) Deputy Directors, who shall 
be appointed by the President of the Philippines, upon the 
recommendation of the Secretary of Labor and Employment.
The Executive Director shall have the same rank, salary, benefits and 
other emoluments as that of a Department Assistant Secretary, while 
the Deputy Directors shall have the same rank, salary, benefits and other 
emoluments as that of a Bureau Director. The members of the 
[Commission] BOARD representing labor and management shall have 
the same rank, emoluments, allowances and other benefits as those 
prescribed by law for labor and management representatives in the 
Employees' Compensation Commission."


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Sec. 7. Abolition of the Regional Tripartite Wages and Productivity Board. -
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Articles 122 and 123 of the Labor Code of the Philippines, as amended, are hereby
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repealed. Consequently, the Regional Tripartite Wages and Productivity Boards
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(RTWPBs) established under Republic Act No. 6727, otherwise known as the Wage
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Rationalization Act, are hereby abolished.
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The relevant provisions of the Labor Code, as amended, and shall be
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renumbered accordingly.
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Sec. 8. Article 124 of the Labor Code, as amended, is amended and renumbered
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to read as follows:
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"Art. [434] 122. Standards/Criteria for minimum wage fixing. The
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[regional] NATIONAL minimum wage[s] to be established [by the
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Regional Board] shall be [as nearly adequate as is economically feasible
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to maintain the minimum standards of living necessary for the health,
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efficteney and general well-being of the employees within the framework
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ef-the national economic and social development program] SET AT A
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LEVEL THAT IT SHALL BE SUFFICIENT TO COVER THE BASIC
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AND ESSENTIAL EXPENDITURES NECESSARY FOR RAISING A
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FAMILY, INCLUDING, BUT NOT LIMITED TO, ADEQUATE FOOD,
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CLOTHING, SHELTER, EDUCATION, HEALTH CARE,
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TRANSPORTATION, AND OTHER SOCIAL AND ECONOMIC
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NEEDS, WITH REASONABLE PROVISION FOR SAVINGS AND
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SOCIAL SECURITY. In the determination of such [regional]
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NATIONAL minimum wage[s], the NWPB AND THE CONGRESS
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[Regional Board] shall, among other relevant factors, consider the
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following:
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a. The [demand for] RIGHT TO living wages;
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b. MOVEMENTS IN THE [Wage adjustment vis-a-vis the] consumer
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price index (CPI);
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c. The cost of living and changes or increases therein;


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d. The ESTIMATED COST REQUIRED TO PROVIDE A WORKER 
AND HIS OR HER FAMILY WITH ADEQUATE ACCESS TO 
FOOD, CLOTHING, DECENT HOUSING, EDUCATION, HEALTH 
CARE, AND OTHER ESSENTIAL NON-FOOD EXPENDITURES 
NECESSARY TO ENSURE THEIR WELL-BEING AND 
MAINTAIN A DIGNIFIED STANDARD OF LIVING [needs-ef 
workers and their families];
e. [The need to induce industries to invest in the eeuntryside] THE
PHYSICAL, SOCIAL, AND OTHER ESSENTIAL NEEDS OF 
WORKERS AND THEIR FAMILIES NECESSARY TO PROMOTE 
THEIR HEALTH, WELL-BEING, AND OVERALL QUALITY OF 
LIFE;
f. Improvements in standards of living; AND
g. [The prevailing wage levetst]
h. [Fair return of the capital invested and-capacity to pay of
employers;]
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[Effects on employment generation and family income; and]
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[6)1 G- The equitable distribution of income and wealth along the 
imperatives of economic and social development.
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[The wages proscribed in accordance with the-provisions of this- Title
shall bo the standard prevailing minimum wages in every region. These
wages shall include wages varying with industries, provinces or localities
if in the judgment of the Regional Board, conditions make such local
differentiation proper and necessary to effectuate-the purpose of this
Titter]
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Any person, company, corporation, partnership or any other entity 
engaged in business shall file and register annually with the appropriate 
[Regional—Board,—Commission] REGIONAL OFFICE OF THE 
DEPARTMENT OF LABOR AND EMPLOYMENT and the [National 
Statistics Office] PHILIPPINE STATISTICS AUTHORITY (PSA), an


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itemized listing of their labor component, specifying the names of their 
workers and employees below the managerial level, including learners, 
apprentices and disabled/handicapped workers who were hired under 
the terms prescribed in the employment contracts, and their 
corresponding salaries and wages.
Where the application of any prescribed wage increase by virtue of a law 
or EXECUTIVE wage order [issued -by any Regional- Board] results in 
distortions of the wage structure within an establishment, the employer 
and the union shall negotiate to correct the distortions. Any dispute 
arising from wage distortions shall be resolved through the grievance 
procedure under their collective bargaining agreement and, if it remains 
unresolved, through voluntary arbitration. Unless otherwise agreed by 
the parties in writing, such dispute shall be decided by the voluntary 
arbitrators within ten (10) calendar days from the time said dispute was 
referred to voluntary arbitration.
XXX
The pendency of a dispute arising from a wage distortion shall not in 
any way delay the applicability of any increase in prescribed wage rates 
pursuant to the provisions of law [or wage order].
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All workers paid by result, including those who are paid on piecework, 
takay, pakyaw or task basis, shall receive not less than the prescribed 
NATIONAL MINIMUM wage rates per eight (8) hours of work a day, 
or a proportion thereof for working less than eight (8) hours OR
OUTPUTS PRODUCED.
All recognized learnership and apprenticeship agreements shall be 
considered automatically modified insofar as their wage clauses are 
concerned to reflect the prescribed NATIONAL MINIMUM wage 
[rates].
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PROJECT EMPLOYEES AND SEASONAL EMPLOYEES SHALL BE
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ENTITLED TO THE PRESCRIBED NATIONAL MINIMUM WAGE.
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Sec. 9. Credible Wage Increase. - Any wage increase granted under a collective
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bargaining agreement (CBA) or through other voluntary employer-initiated
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arrangements shall be considered separate and distinct from the minimum wage
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increase mandated under this Act. Such wage increases shall not be credited or applied
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as compliance with the statutory minimum wage adjustments prescribed herein.
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This provision is without prejudice to the continued validity and enforceability
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of any existing wage benefits or favorable terms under CBAs or other agreements that
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provide higher rates than the prescribed minimum wage.
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Sec. 10. Prohibition on Layoffs and Downsizing. - It shall be unlawful for any
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company, corporation, partnership, or other business entity to terminate employees
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or implement downsizing solely for the purpose of avoiding compliance with the wage
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increases mandated under this Act.
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Sec. 11. Terms of Service of the Regional Tripartite Wages and Productivity
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Board Secretariat. - The terms of service of the members of the secretariat of each
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RTWPB shall terminate upon the effectivity of this Act: Provided, That said members
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shall be given preferential consideration for appointment to equivalent positions in
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government agencies or bureaus, subject to existing rules and regulations of the Civil
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Service Commission (CSC).
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Sec. 12. Wage Subsidies. - Micro- and small enterprises unable to meet the
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new national minimum wage may apply for wage subsidies equivalent to a fraction of
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the mandated wage, subject to the implementing rules and regulations of this Act.
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The necessary funds for the wage subsidy program shall be incorporated in the annual
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appropriations of the DOLE.
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Sec. 13. Non-Diminution of Benefits. - Nothing in this Act shall be interpreted
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to reduce, eliminate, or otherwise impair existing benefits granted to workers, whether
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provided under collective bargaining agreements, existing laws, or other applicable
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regulations.


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Sec. 14. Penalties. - Section 12 of Republic Act No. 6727, which was amended
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by Section 1 of Republic Act No. 8188, is hereby further amended to read as follows:
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"Sec. 12. Any person, corporation, trust, firm, partnership, association 
or entity [which] THAT refuses or fails to pay THEIR WORKERS [any 
ef] THE NATIONAL MINIMUM WAGE [the] prescribed UNDER 
THIS ACT, INCLUDING ANY SUCCEEDING LEGISLATIVE WAGE 
increases or adjustments, [in the wage rates mode in Dccordonco with 
thIs-Act] shall be LIABLE TO [punished hy] a fine EQUIVALENT TO 
ONE HUNDRED PERCENT (100%) OF THE TOTAL WAGE 
INCREMENT DUE TO THE EMPLOYEE, MULTIPLIED BY THE 
NUMBER OF WORKING DAYS THE WAGE INCREMENT REMAINS 
UNPAID, [not less than Twenty-five thousand pesos (P25,000) nor 
more One hundred thousand pesos (P10Q,000)] or TO imprisonment of 
not less than [two (2)] THREE (3) years BUT NOT [nor] more than 
[four (4)] FIVE (5) years, or both, [such fine and imprisonment] at the 
discretion of the court: Provided, That any person convicted under this 
Act shall not be entitled to the benefits provided for under the Probation 
Law.
The employer concerned shall LIKEWISE be ordered to pay EACH 
AFFECTED EMPLOYEE MORAL DAMAGES [aa] amountING TO 
FIFTY THOUSAND PESOS (P50,000.00), IN ADDITION TO 
DOUBLE THE AMOUNT OF UNPAID BENEFITS DUE. [equivalent to 
double the unpaid benefits owing to the employees:-Provided, That]
THE payment of indemnity shall not absolve the employer from the 
criminal liability imposable under this Act.
IN ADDITION, THE BUSINESS PERMIT OF THE OFFENDING 
ENTITY SHALL BE SUSPENDED FOR A PERIOD OF ONE (1) 
MONTH TO THREE (3) YEARS FOR A SECOND OFFENSE. FOR A 
THIRD OFFENSE, THE BUSINESS PERMIT SHALL BE REVOKED.
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If the violation is committed by a corporation, trust or firm, partnership,
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association or any other entity, the penalty of imprisonment shall be
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imposed upon the entity's responsible officers, including, but not limited
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to, the president, vice-president, chief executive officer, general
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manager, managing director or partner."
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THE DOLE SHALL LIKEWISE HAVE THE AUTHORITY TO IMPOSE
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SUCH OTHER ADMINISTRATIVE PENALTIES AS IT MAY DEEM
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APPROPRIATE, BASED ON THE CIRCUMSTANCES OF EACH CASE
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OF VIOLATION.
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Sec. 15. Implementing Rules and Regulations. - DOLE, in coordination with
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other concerned government agencies, shall promulgate the necessary rules and
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regulations for the effective implementation of this Act within sixty (60) days from its
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effectivity.
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Sec. 16. Separability Clause. - If any provision or part hereof is held invalid or
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unconstitutional, the remaining provisions not affected thereby shall remain valid and
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subsisting.
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Sec. 17. Repealing Clause. - Any law, presidential decree or issuance, executive
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order, letter of instruction, administrative order, rule or regulation contrary to or
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inconsistent with the provisions of this Act is hereby repealed, modified or amended
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accordingly.
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Sec. 18. Effectivity. - This Act shall take effect fifteen (15) days after its
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publication in the Official Gazette or in any two (2) newspapers of general circulation
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in the Philippines.
Approved,
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