Goodbye, ‘endo’?

President Rodrigo Duterte made his administration’s second Labor Day a dramatic one by revealing that he had signed an executive order (EO) that bans all forms of unlawful contractual labor, fulfilling a campaign promise.

He also asked Congress to review and amend the Labor Code, particularly the articles that have allowed employers to use contractual workers, such as during peak seasons in the construction, manufacturing, retail, and tourism sectors.

President Duterte’s second point is easier to celebrate. Indeed, a review of the Labor Code is overdue. It needs to be overhauled so that it can better protect workers who face not only old challenges like unsafe working conditions and the lack of job security, but also emerging ones like the risk of being supplanted by increasing automation or artificial intelligence, or by the presence of cheaper labor abroad.

Whether or not the EO is truly new, is a trickier question.

It reportedly prohibits “illegal contracting or sub-contracting, when undertaken to circumvent the workers’ right to security of tenure, self-organization and collective bargaining.” First, how is this different from Article 106 of the Labor Code, which has long empowered the labor secretary to prohibit “the contracting-out of labor to protect the rights of workers”? Second, does the ban now cover the construction industry, where contracting and sub-contracting arrangements are rampant?

In March 2017, the labor department attempted to crack down on “endo” in its Department Order 174, where it prohibited the “repeated hiring by a contractor or sub-contractor of employees under an employment contract of short duration.” This is “endo” as it is most commonly understood, the cruel practice of cutting off a short-term worker’s contract before he or she has spent enough time at work to demand a regular employee’s protections and benefits.

But Department Order 174 also excluded construction “and other industries,” which was why the practice of “pakyaw” or payment on the basis of results could continue. Is this practice, as legitimized by Department Order 19, banned now? On that, Malacañang needs to be clearer.

What’s apparent is that this executive order, while welcome, is low-hanging fruit. Whether or not it makes a real difference will hinge on enforcement. Where 2.2 million (or five percent of the labor force) continue to chase after jobs and 6.6 million (or 15.9 percent) of those already employed want to work more hours, even short-term work arrangements can seem attractive, never mind the risk of “endo.” That long-awaited EO may now be out, but the labor department still has plenty to do.