Employers Warn of Job Cuts Over Plan to Ban Contractualisation

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Image Caption: Workers hold banners as they march towards the Department of Labour and Employment (DOLE) office for a rally in Manila.


By Catherine S Valente Manila Times

Malacanang has vowed to strictly implement a ban on unlawful contractualisation, as militant workers stormed the Department of Labour and Employment (DoLE) in Manila for issuing an order that did not prohibit all forms of labour contracting.

In a statement, presidential spokesman Ernesto Abella lauded the new DoLE order that lays out stricter guidelines for contractualisation as a “major step” in ensuring that Filipino workers enjoy their rights.

“The Department Order 174 issued by the Department of Labour and Employment (DoLE) regulating the contracting and subcontracting of employees is a fulfilment of the campaign promise of the president. This is a major step in upholding and protecting the labour rights of our great Filipino workers,” Abella said.

The Palace official assured workers “the government was working very hard to promote more humane conditions and fair and just treatment of workers in the workplace.”

Labour Secretary Silvestre Bello signed on Thursday, the  Department Order 174 that imposes a total ban on illicit forms of employment arrangements. It supersedes Department Order 18-A, which allowed some forms of contractual arrangements and “endo” or end-of-contract schemes.

The department order released Thursday listed 11 “prohibited” practices, including contracting through an in-house agency and contracting work that is also done by regular employees.

It also calls for the strict regulation of “legal” contracting and subcontracting.

The DoLE shortened the validity of the registration of contractors to two years from three years, and also increased the registration fee to P100,000 from P25,000.

The order states, citing the Labour Code, that the secretary of Labour has no power to prohibit all forms of contractualisation and fixed-term employment, and that the matter is a function of legislation.

Still, members of the militant Kilusang Mayo Uno (May One Movement) marched toward the DoLE headquarters in Intramuros, Manila to protest the new order. Some of the rallyists tried to force open the door to the DoLE building.

The group claimed the order would further legitimise contractualisation, instead of ending it.

Also on Friday, the Employers’ Confederation of the Philippines (ECOP) warned that the new order would further burden small and medium enterprises, and result in the loss of jobs.

In an interview over ABS-CBN morning show “Umagang Kay Ganda,” ECOP acting president Sergio Ortiz-Luis Jr said that while the order might look good before the media, its effects on the people would be felt within the coming days.

“The small and medium enterprise businessmen will be affected by the order. Jobs may be lost as they may not be able to sustain (the business),” he said.

In a separate interview aired over dzMM radio, Donald Dee, also an ECOP official, said the Labour department order was filled with “ambiguities.”

“The impact of the order is immediate, because all companies will stop the practice of hiring workers for five months,” he said, referring to short employment contracts that go around Labour Code provisions requiring the regularisation of workers who have reached six months of service. “We are not singing the Alleluia,” he added.

The “ambiguities” include the order’s failure to define “only permissible contracting,” Dee said. This, for example, could put a furniture company that outsources some of its production in a quandary, he said.

“Many people will lose jobs. We are not making threats. It’s simple common sense,” Dee said. A DoLE official shrugged off the statement of the employers’ group, calling it an “old story.”

“As the saying goes, if you don’t want to do it, you can come up with a lot of reasons,” Labor Undersecretary Bernard Olalia said.

Olalia also said the department was finalising the guidelines on deputising labour groups and other organisations to help in assessing the more than 90,000 establishments targeted for inspection this year.

Under the guidelines, labour groups and some government and non-government organisations, including those in the medical industry, will be deputised to assist the DoLE in inspecting establishments, he said.

To ensure the effective implementation of the guidelines, Olalia said labour law compliance officers would still supervise the assessment of the establishments.


(Source: Gulf-Times.com)

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