The Employers Confederation of the Philippines (ECOP) has voiced grave concern over Senate Bill 80, authored by Sen. Jinggoy Estrada, otherwise known as the proposed Workers Productivity Incentives Act.

The bill proposes to grant all workers an annual productivity incentive bonus of not less than 10% of net profit before taxes.

There shall be no diminution of existing benefits, whether granted by law, employer policy/practice or contract, according to the bill.

For failure or refusal to pay the annual productivity incentive bonus, the bill slaps penalties such as being liable to the worker for thrice the accrued grant, moral damages of P30,000 for each affected worker, imprisonment of 1-2 years plus cost of litigation and attorney’s fees, and if violation is committed by a foreign individual, summary deportation after complete satisfaction of his adjudged liabilities.

ECOP asserts that the bill is confiscatory, since regardless of whether or not the workers contributed to the improvement of productivity of the enterprise, they are entitled to not less than 10% of the net profit before taxes, to the prejudice of the priority right of stockholders under the law whose share of dividends of net profit after taxes are diminished or even lost.

At the same time, ECOP cited other repercussions of the bill such as double jeopardy for employers who have collective bargaining agreements (CBAs); impairment of capital formation by reducing the ability of enterprises to reinvest retained earnings or net profits for expansion, growth, and creation of jobs; impairment of the rights and obligations of CBA which is deemed by law as a labor contract; and precipitating massive capital flight and thus, transform the country into an investment pariah.