Mandatory Profit-Sharing for Employees?

[Altis6453]

I don't know if our congressmen really study the ramifications of the bills they propose in Congress. Does this make sense?

House to study proposal on mandatory profit-sharing
By Paolo Romero (The Philippine Star) Updated March 20, 2012 12:00 AM Comments (2) View comments

MANILA, Philippines - A proposal to make profit sharing mandatory in large firms to improve the lives of workers is under study at the House of Representatives.

Northern Samar Rep. Emil Ong, committee on labor and employment chairman, yesterday said Congress must look into distribution of wealth as many are complaining that only employers are getting rich.

“Because of this, we are seriously considering to enact a law on profit sharing, and this is what the employers don’t want because their books would be opened because it would be the basis for profit sharing,” he said.

“But this (profit sharing) is good for the government also because it can ensure that the correct taxes are paid.

“If the employees are well-compensated, they’ll work more seriously and won’t be lazy and won’t ask wage increases every year.”

Meanwhile, Ong said he is optimistic the committee will approve a consolidated bill for a higher minimum wage this May.

“We would have wanted to approve the bill on May 1 (Labor Day), but our schedules were tight and there’s this impeachment trial,” he said.

Ong said before Congress adjourns sine die in June, the legislated wage bill would be on the floor for approval.

“We held many hearings all over the country and both sides (labor and business) have no objections, though the labor groups want to make wages in the provinces at par with Metro Manila since the price of cooking gas, rice are the same anyway,” he said.

Ong said two leading proposals were made on legislated wage hike: One seeks a P125 increase, while the Trade Union Congress of the Philippines is pushing for a P90 hike.

“I’m 100 percent optimistic that the committee will approve a wage hike bill this May,” he said.

“For the committee, we have no problems with that, I just hope there won’t be any opposition in the plenary.”

The committee held hearings in Luzon, Visayas and Mindanao “to know the different situations,” Ong said.

[shadow]

Sa senior management Lang yan, pwede ba naman Sa lahat yan

[boybi]

Pano kapag nalugi naman yung company for a particular year, makiki-share din ba employees sa lugi? maglalabas sila ng pera para sa company?

“If the employees are well-compensated, they’ll work more seriously and won’t be lazy and won’t ask wage increases every year.”

Kapag marami ng pera isang employee, gusto na nya nagrerelax at ginagastos ang pera. kapag naubos na pera, tsaka babalik ulit sa trabaho.

[shadow]

Pano kapag nalugi naman yung company for a particular year, makiki-share din ba employees sa lugi? maglalabas sila ng pera para sa company?

Kapag marami ng pera isang employee, gusto na nya nagrerelax at ginagastos ang pera. kapag naubos na pera, tsaka babalik ulit sa trabaho.

cooperative yata gusto nila mangyari Sa mga companies

[vinj]

Ano kaya gagawin nila Henry Sy, Ayala, et. al. sa Congressman na nag propose nyan? Won't this affect tax revenues as firms will now be hiding more of their revenues or result to creative accounting to further bring down profits?

Doesn't seem too good from the top of my mind.

[niky]

Of course businesses like it.

If a business shows no on-paper profit, it doesn't have to give those bonuses.

There are progressive businesses and institutions that practice profit-sharing. Some even include shares in the business as part of the compensation package, but this leads to the specter of hostile takeover. (I believe this happened to FEU).

It's not for everyone, though. And making it mandatory is like passing a law enforcing Kaizen or Six Sigma. While they're good business ideas, it's not the government's job to micromanage businesses this way.

[Retz]

Ito ba ung SLA Co-op ?

[Altis6453]

I'm inclined to agree with Boybi. If government makes profit-sharing mandatory, they might as well make sharing the business losses mandatory for employees, too.

[number001]

Northern Samar Rep. Emil Ong, committee on labor and employment chairman, yesterday said Congress must look into distribution of wealth as many are complaining that only employers are getting rich.

Employers (usually entrepreneurs) get rich bec. that is their reward for sacrificing a lot and starting a business.

Forced profit sharing accomplishes nothing but to disincentivize present and future entrepreneurs, innovators, inventors, etc...

This reminds me of those leeches taking a joy ride during group work time in college and high school. One or two does all the heavy lifting while the rest are just there in name.

[Retz]

It was indicated in the article those only "large firms" that could afford profit sharing. It is not applicable to all.