Employers’ woes contractualization and DOLE inspections?
The president is currently being pressured by both management and labor sectors on the issue of outsourcing and DOLE’s visitorial powers. Labor is demanding for the signing of a new executive order and the employers are vehement in their objections. A DOLE undersecretary has resigned and more movements are in the offing.
The problem with many employers in Cebu and the whole country is that they complain against DOLE for conducting too many inspections but they refuse to teach their managers how to properly lead their people and manage their businesses. DOLE is only doing its job to make sure workers get proper wages and benefits. DOLE has a job to do and the inspectors are ordered to do these. They have a mandate to make sure occupational safety and health standards are strictly followed so workers’ health, safety, security, and welfare are cared for. The problem is not DOLE. The problem is that management refuses to equip their HR managers with enough knowledge and skills on how to comply with general labor standards. The more problematic issue is the one on contractualization.
The companies do not even know how to document a simple service agreement between a legitimate service contractor and a principal employer. There is no template on choosing service providers. There is no purposive effort to educate managers on how to avoid being tagged as engaging labor-only contractors. They do not choose the non-core functions to be farmed out, they do not avoid being in control of contractors’ workers. In other words, what the employers’ sector needs is basic education on proper management and coordination. Just because they know how to do business doesn’t mean they know how to comply with labor laws.
Management is unprepared on how to compute wages on holidays for the first eight hours and overtime. How did these people become managers? Many payroll clerks do not know how much is the rate when a holiday falls on a rest day and the worker is required to work. Many of them do not know the difference between holiday pay and holiday premium pay. How then would company owners blame DOLE inspectors if these officials give them so many negative findings? The problem is not in DOLE but in their own staff. They should put their house in order. And if they need help, they should call the real experts, not the fake ones.
The most dreaded finding is the so-called “LOC” or Labor-Only Contracting. The Jollibee decision is a warning to all firms that very soon, DOLE inspectors shall come knocking on their doors. If they are unprepared, then they should be forewarned that serious consequences can come about. This columnist has been helping big conglomerates on the art and science of preparation for DOLE inspections. As a former undersecretary of DOLE itself, I am very familiar with the rules of inspections and I trained most of the DOLE inspectors. I am surprised how management could neglect such a very important matter of preparation prior to DOLE inspections. Many of the companies lost their cases not really because they violated labor laws. It is because they do not know how to prove that they have in fact complied.
The fault, my dear, is not on DOLE, not even on the labor sector, but on employers themselves that they refuse to learn despite the availability of so many resource persons to teach. They cannot bribe labor inspectors or use pressure to avoid labor problems. Management has to level up or perish.