Kentex owes workers P7.8 M

The Department of Labor and Employment (DOLE) reported yesterday that Kentex Manufacturing Corp. and its labor sub-contractor CJC Manpower Services are initially liable to pay P7.8 million in underpaid wages to 99 workers of the rubber slippers factory that burned down last May 13 and killed 72 people in Valenzuela

City.

According to Labor Secretary Rosalinda Baldoz, DOLE Regional Office No. 3 director Ana Dione is set to issue next week a compliance order directing the two companies to pay the workers.

“A compliance order will be issued against Kentex and CJC Manpower Services directing them to pay the amount due the workers under the Labor Code, as amended, and other labor laws. Kentex will shoulder the liabilities as the direct employer, CJC Manpower Services, being a labor only contractor,” Baldoz noted.

The amount is based on an initial computation and does not include yet other monetary benefits due the workers, such as overtime pay, night differential, 13th month, holiday pay, unused vacation and sick leave, refund of cash bond, and other emoluments, including social security.

Baldoz added that the initial amount does not include the amount accruing the regular workers of Kentex, which will be the subject of another compliance order to be issued by DOLE National Capital Region director Alex Avila.

“And since the establishment is unionized and has a valid collective bargaining agreement (CBA) until 2017, union members are entitled death benefits equivalent to 15 days of salary times the number of years in the service, as well as other benefits stipulated in the CBA,” she said.

The officers and owners of Kentex and CJC Services may also be held criminally liable for violation of Republic Act 6727, as amended by RA 8188 for failure to pay any of the prescribed increases or adjustments in the wage rates, given the noted underpayments.

“The penalty for such could be a fine of not less than P25,000 not more than P100,000, or imprisonment of not less than two years not more than four years, or both such fine and imprisonment at the discretion of the court,” she maintained.

Kentex and CJC Manpower Services also face criminal liability for violation of the Labor Code, which declares that unlawful “withholding of any amount from the wages of a worker or induce him/her any part of his/her wages by force, stealth, intimidation, threat, or by any other means whatsoever without his/her consent, for which the penalty is a fine ranging from P1,000 to P10,000, or imprisonment of not less than three months not more than three years, or both can be imposed.”

Baldoz added that violation of occupational safety and health standards is not a criminal offense under the Labor Code but the fraud committed by Kentex in the course of the joint assessment is unlawful and could include penalties.

Davao City Rep. Karlo Alexei Nograles raised yesterday the need to revisit the country’s Labor Code and fine-tune provisions that allow the hiring of contractual workers.

During the inquiry of the House labor committee chaired by Nograles, it was learned that most of the workers of Kentex slipper factory were sub-contracted from an unlicensed agency CJC Manpower Services.

The House panel also discovered that DOLE’s labor law compliance officers (LLCO) conducted three inspections of the Kentex facility but failed to verify the background of the agency that supplied the workers.

“If only the LLCO checked with DOLE records he would have found out that CJC is not registered as a legitimate subcontractor and therefore illegal,” Nograles said.

He said this is one of the many schemes that some businessmen would use to skirt the country’s labor laws.

“They hire from third party manpower pooling firms not only to avoid the additional cost of wage and non-wage benefits due to the hiring of new workers but also to avoid responsibilities on matters related to occupational safety. The legal issue as to who should take responsibility on the welfare of an employee is obscured by this policy on contractualization,” Nograles said.

He said there is a need to amend some provisions of the Labor Code, which allows the practice of hiring contractual workers, in order to protect the workers without compromising the viability of doing business in the Philippines.

“Our committee is currently harmonizing several pending bills seeking various amendments to the contractualization provisions of our Labor Code and some measures on the issue of occupational safety. We are giving top priority to these bills,” Nograles said.