Pro-Filipino Labor Law
Among the key campaign promises of President Rodrigo Duterte in 2016 was ending contractualization, more known as end-ofcontract or “endo”. But where are we now in terms of fulfilling this huge promise?
After years of delay, the labor sector is finally seeing the clear skies as the Senate on Wednesday, May 22, passed on third and final reading Senate Bill No. 1826 or Security of Tenure Act, a measure that is expected to stop endo.
Endo has been a towering problem faced by Filipino workers for years. Contractualization is generally understood as the arrangement by which a company taps a contractor for a labor force to complete a specific job or project within a specified period, a scheme preferred by some firms whose business operations are seasonal. Most cases involved related to this problem is the termination of the worker’s contract on the fifth month of their employment. The Labor Code mandates that for an employee to be regularized, s/he needs to render service of at least six months.
This scheme left laborers at the mercy of the unfair labor system.Contractual or project-based workers are most prevalent in construction, manufacturing, and wholesale and retail trade.
Let’s take a quick walk down memory lane of the measures placed as far as addressing endo is concerned. The House of Representatives passed its version of the bill (House Bill 6908) on January 29, 2018. It seeks to amend the Labor Code of the Philippines, or Presidential Decree No. 442.
Under the House version, the law requires job contractors to secure a license from the Department of Labor and Employment, through the regional offices, before they could start operations. It also amended Article 294 of the Labor Code so that an employer may terminate an employee only for a just cause or when authorized and Article 295 to prohibit fixed-term employment, except in cases of overseas Filipino workers, workers on probation, relievers
who are temporary replacements or absent regular employees whose engagements shall not exceed six months, project employees, and seasonal workers.
On May 1, 2018 President Duterte signed an executive order (EO) that reinforces a complete ban on “labor-only” contracting scheme. The EO states that “contracting and subcontracting, when undertaken to circumvent the workers’ right to security of tenure, self-organization and collective bargaining and peaceful concerted activities, pursuant to the 1987 Philippine Constitution, is hereby strictly prohibited.”
But an EO is never enough to totally ban endo as there were legal activities requiring contractual relation, thus the need for Congress to amend the “outdated” Labor Code.
The approval of the bills in both houses is a welcome move as only a new law can change the miserable situation of contractual workers.
The Senate version classifies workers under four employment types: regular, probationary, project, and seasonal. Project and seasonal workers have the same rights as regular employees like the payment of minimum wage and social protection benefits, among others, for the duration of their employment.
The Security of Tenure Bill’s ball is now on the bicameral conference before it will move to the Executive branch. Dole reported that 413,940 workers from the private sector have been regularized since President Rodrigo Duterte assumed office in 2016.
Though this accomplishment is a step forward, a lot has yet to be done as there are an estimated 1.3 million contractual employees in the country. But with the new labor law on the rise, the future is bright. Also, if the government is serious about wiping out this labor malpractice, the government’s “contract of service” and “job order” schemes must also be eradicated. It should start from within.
As the new law awaits for the BiCam conference, we call on the legislators and the administration to come up with nothing but a law that is pro-labor, pro-business, in short, pro-Filipino.