How much is a legal tender?

Published June 28, 2021, 9:07 PM

by Joseph Pedrajas

Can an employer pay their employees’ salaries purely in coins?

Under Circular No. 537 Series of 2006 issued by the Bangko Sentral ng Pilipinas (BSP), payment, particularly in the form of coins, shall be “legal tender” or must be accepted for as long as it does not exceed a certain limit.

For P1 to P5 denominations, they must not exceed P1,000 while 1, 5, 10 or 25 cents must not exceed P100 in total.

Several social media users pointed this out, citing the circular from the BSP, after the report about a Valenzuela City worker who received his salary in coins worth P1,056, mostly in 5-cent and 25-cent and one-peso denominations, made the rounds Monday.

Some even said the action done by the worker’s employer was illegal, although the local government of Valenzuela and the concerned factory worker in the incident have not done yet a complete inventory of the coins, so the legality of the incident cannot be said yet.

But the factory worker believed the action was done “intentionally” as a form of “retribution” of the company against him for complaining about alleged unfair labor practices they experienced, Mayor Rex Gatchalian said.

“Nakakalungkot na may mga tao na ganito i-treat yung mga workers (It’s saddening that there are people who treat their workers like this). You didn’t know how hard for them to really work for their family. 24hrs duty yet you gave that kind of salary,” a Twitter user with username @yoursonlylisa said.

“Imagine being exploited and stressed for 24 hours only to receive your salary in a medium that will make things harder for you?” a certain @_bigbryte also said.

“This is evil. Purely evil,” added a certain @marwiiiiiiin.

Mayor Rex Gatchalian said he is set to meet the company’s owner on Wednesday to “get to the bottom of this cruel and unusual labor practice and deal with it accordingly.”

He also said he will look into the factory worker’s complaints about the alleged unfair labor practices inside their company, including underpayment and lack of government benefits and night differential pay.