WBF Roundtable Presentation of ALEX AVILA Assistant Secretary, Department of Labor and Employment (DOLE) Makati Shangri La, 8 June 2017 The Department of Labor and Employment has formulated and submitted 8‐Point Labor and Employment Agenda, in support of the labor and employment objectives of the Philippine Development Plan (PDP) 2017‐2022 and the 10‐Point Agenda of the President. The 8‐Point Labor and Employment basically centers on addressing employment and underemployment; ensuring that the rights of the workers are respected; ensuring that the overseas Filipino workers are protected and secured; social protection for the workers and their families; engagement with social partners in both the employers and the labor sector; more efficient institutions, with a sense of purpose and accountable to the workers and the people in general; continuously ensure that the labor dispute resolution system is efficient, free of corruption, honest and credible; policies that are equitable, and a product of social dialogues and resolutions. On full respect of the basic rights of workers, illegitimate forms of contracting and sub‐contracting will be eliminated. This continues to be DOLE’s priority in 2017, responding to the directives of the President to end “ Endo ” or the “ 5‐5‐5 arrangement ”. DOLE has encountered the prevalence of these arrangements in hotels and resorts, retail trade industry, shopping malls and fast food chains, business parks in Mindanao, hospitals and manufacturing especially in the economic zones. Around 48,000 workers have been regularized. DOLE plans to inspect 55,000 establishments in 2017, with the hope that regularization will continue. DOLE has had little problem on labor cases involving contractualization as it has ensured that conciliation mediations are conducted first to settle these cases. Presently, the resolution of compulsory arbitration cases has become speedier, no longer taking 1‐2 years. On the issue of unemployment and underemployment, the Trabaho, Negosyo, Kabuhayan (Jobs, Business, Livelihood) Blueprint, together with the Department of Trade and Industry (DTI) seek to facilitate the creation of additional 7.5 million jobs under PDP 2017‐2022. The key employment generators under the blueprint are agribusiness, manufacturing. Construction, tourism and IT‐BPM. DOLE will continue to provide technical assistance to micro, small and medium enterprises (MSMEs). It will also improve the Labor Market Information System, an on‐line job system portal where jobseekers can look for and apply for job. Companies are encouraged to enroll and post their job vacancies for free, unlike JobsDB and Jobstreet.com. There is also the Government Internship Program, where graduates having difficulty in landing jobs are given 6‐month training in government institutions. With the DTI there is also collaboration on transforming informal livelihood projects towards formality. DOLE noted that underemployment, which means workers want to work additional hours because they think they need to earn additional income, is higher in regions with higher employment rate, such as the NCR, Region IV‐A and Region VII. High underemployment rate is the one issue that DOLE is trying to address as this pertains to income. Social protection is another priority of the Department. In partnership with other government agencies like the Department of Social Welfare and Development (DSWD) and the Department of Education (DepEd), DOLE would like to remove the 630,000 child laborers from that situation. The Department would also like to ensure that the minimum wage rates are above the poverty threshold, making it a social 1
safety net or a form of social protection. The number of minimum wage rates will also be reduced, so there will be less wage differentials. DOLE will continue to make sure that overseas Filipino workers are protected from recruitment to deployment to onsite working conditions to repatriation. Human trafficking and illegal recruitment will be properly addressed, with violators immediately prosecuted. The policy is to make employment opportunities available locally, so the decision to work abroad is a matter of choice and not of necessity. Questions and Answers Question: What is the government doing on Labor Code reforms? Are there any parts being relaxed to allow flexibility of operations? Answer: There are several bills amending specific provisions of the Labor Code, particularly on the security of tenure and occupational safety and health standards. With respect to the bills on security of tenure, DOLE supports the intention of protecting the workers, but this is balanced by the right of employers to expand and grow. Question: What assurances does the Department provide on returning overseas contract workers that they will be able to get their jobs back and enjoy the same benefits they had before? Answer: There is a reintegration program handled by the National Reintegration Center for OFWs (NRCO). It provides financial assistance to returning OFWs. But the problem the Department encounters with repatriates is pay. They received higher pay abroad, so this is something that needs to be addressed not just by DOLE but also with the help of the local business community. Question: The challenge the company (a cargo terminal operator) has right now is that while it provides skills training with certification and above average compensation, other countries where the demand is also higher get these skilled people. Perhaps the government should look into programs that would entice these workers to not leave their families because the growth opportunities are here in the Philippines, and the industry needs these skilled people. Comment from Another Participant : Solid on the job training for young people, as young as 18 years old, validated by a certificate that has value, can create jobs and give flexibility to employees, moving from one company to another by virtue of their certification and development of skills different from a degree in a university. Answer: The country has an apprenticeship law, but this needs to be amended because the maximum training period is only 6 months. There are skills that can’t be learned in just 6 months, not even in one year. This is the issue being addressed by the proposed amendment of the law. Employers should also support apprenticeship and double training for the skills development program to succeed. Question: Are there initiatives or reform programs in the pipeline that will encourage employers to stay in business and invest more? 2
Answer: The Department of Trade and Industry (DTI) can better respond to the question, as it is DTI which makes sure the investment climate in the Philippines is attractive. DOLE is doing its best to keep the labor situation stable. The Department is also giving recognitions to companies which are compliant with labor and occupational safety standards, such as the Philippine National Bank (PNB) recently. Question: You need to have vocational training established in the country which enables a person to learn a profession professionally. And whatever number of years that profession takes to learn, it has to be recognized with a certificate known by employers and the government nationwide. This should support especially the small and medium enterprises, which need professionalized baker, butcher, electrician or carpenter. It’s a wrong focus to regularize a worker after 6 months, when vocational training takes 3 years, it will put tremendous pressure on SMEs. Answer: There is the so‐called Philippine Qualification Framework, which is related to the ASEAN Qualification Reference Framework, with the Technical Education and Skills Development Authority (TESDA) ding the assessment and qualification. The K‐12 Program also has two tracks, the technical vocation livelihood track and the academic track. It is still a long way to go for the Philippines to be able to adopt the German apprenticeship system, although this is the model that the Philippines looks up to. Question: What is the role of SENA (Single Entry Approach) particularly in Region IV? Some contractual employees with contracts that have ended have filed cases for a higher amount of money against their principals, and SENA has allowed these cases to be pursued up to the National Labor Relations Commission (NLRC). Answer: SENA is a first approach mechanism for resolving labor disputes, settling issues without litigation and avoiding full‐blown conflicts. There might be instances where workers, the requesting party, raise the complaint further to higher DOLE offices if the dispute is not resolved within 30 days. Questions: (1) Under the proposed tax reform program, incentives for ROHQ would be lifted, which could affect the growth of the country’s BPO industry. In this case, what would DOLE do to transition the talents which would be displaced/redirected to other industries if the incentives to BPO are withdrawn? (2) Does DOLE have a policy to determine or request information from the Securities and Exchange Commission (SEC) on the number of women in the board of companies or equivalent contribution in the company? (3) What is DOLE’s program on senior citizens, particularly in enhancing their contribution to the economy? Answers: (1) TESDA may have a program on transitioning from one skill to another as job security can somehow be sustained by skills. And in the case of the BPO industry, this could involve transitioning from voice talent to non‐voice. 3
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