Section 3December 10, 1987, Sec./Art. 3

Where the application of the minimum wage increase prescribed under Section 2 results in distortions in the wage structure within an establishment which gives rise to a dispute therein, such dispute shall first be settled voluntarily between the parties and in the event of a deadlock, such dispute shall be finally resolved through compulsory arbitration by the National Labor Relations Commission's arbitration branch having jurisdiction over the workplace.

It shall be mandatory for the NLRC to conduct continuous hearings and decide any dispute arising under this section within thirty (30) days from the time said dispute is formally submitted to it for arbitration. The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of the wage increase covered by this Act.

For the purpose of this Act, wage distortion shall mean a situation where a legislated increase in minimum wages results in the elimination or severe contraction on intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical basis of differentiation.