* RTWPB 7 urged Central Visayas employers and workers to correct salary distortions following the implementation of Wage Order ROVII-27 on Oct. 15, 2026.
* Under the new wage order, Metro Cebu daily minimum wages increased to P582 and non-Metro Cebu rates rose to P542, prompting labor calls for higher adjustments.
* Organized and unorganized establishments are directed to resolve wage distortion disputes through collective bargaining, mandatory conciliation-mediation, or arbitration, using provided NWPC formulas.
EMPLOYERS and workers in Central Visayas have been urged to review their wage structures and correct salary distortions that may arise from the implementation of the new P42 daily minimum wage increase.
The Regional Tripartite Wages and Productivity Board (RTWPB) 7 issued the reminder following the effectiveness of Wage Order ROVII-27 on Thursday, Oct. 15, 2026, citing National Wages and Productivity Commission (NWPC) Advisory 01-2023.
Under the new wage order, the daily minimum wage in Metro Cebu increased from P540 to P582, while the rate outside Metro Cebu rose from P500 to P542.
The latest adjustment came amid continued calls from labor groups for higher wages, with workers arguing that the new minimum rates remain insufficient to keep pace with the cost of basic necessities.
Wage distortion
A wage distortion occurs when a mandated wage increase eliminates or significantly narrows the intentional pay differences among groups of employees based on skills, length of service or other reasonable distinctions, according to the advisory.
A distortion may arise when the salary of a lower pay class increases significantly without a corresponding adjustment for a higher pay class, eliminating the distinction between the two wage levels.
The NWPC cited four elements in determining the existence of wage distortion: an existing hierarchy of positions with corresponding salary rates; a significant increase in the salary of a lower pay class without a corresponding increase for a higher pay class; elimination of the distinction between the two levels; and that the positions involved are under the same employer within a region.
“The commission encourages enterprises to seek guidance and technical assistance from the RTWPBs in correcting wage distortion issues,” the advisory said.
Settling disputes
For organized establishments or those with unions, the employer and workers’ union must negotiate to correct the distortion.
Disputes must first go through the grievance procedure provided under the collective bargaining agreement, and if the issue remains unresolved, the parties may proceed to voluntary arbitration.
For establishments without unions, employers and workers must also endeavor to correct the distortion.
If they cannot agree, the dispute will undergo mandatory conciliation-mediation through the single-entry approach of the National Conciliation and Mediation Board.
Should the parties still fail to reach a settlement, the matter may be brought before a labor arbiter or, upon agreement of both parties, submitted to voluntary arbitration.
The commission provides formulas and examples that employers and workers may use in adjusting wage structures, although the parties may develop and agree on their own formula based on their circumstances. / DPC