Banks agree to retain employees affected by outsourcing

MANILA, Philippines - Banks agreed to transfer employees affected by the outsourcing in the industry to other departments while the Department of Labor and Employment (DOLE) pledged to provide livelihood programs for affected workers.

This was contained in the Banking Industry Tripartite Council (BITC) resolution signed by various parties the other day.

Bangko Sentral ng Pilipins Governor Amando M. Tetangco Jr. and Labor Secretary Rosalinda Baldoz led the signing of the agreement last Thursday.

“The resolution also considers outsourcing as a bank management prerogative. Should outsourcing lead to downsizing, the resolution requires management to transfer affected employees to other departments on a best effort basis. Management is also tasked to encourage outsourcing firms to absorb the affected workers,” the agreement stated. 

Under the agreement, the DOLE would implement livelihood programs and other interventions for the benefit of the affected workers should remedies prove unfeasible.

The Voluntary Code of Good Practice aims to maintain and promote industrial peace in the banking sector through the use of constant dialogue in resolving disputes arising from emerging issues like outsourcing.

The agreement enjoins management and workers to discuss issues in good faith and to submit unresolved grievances to voluntary arbitration.

Under the agreement, unsettled disputes may be elevated to the BITC that would select a representative from DOLE and two each from labor and management to discuss the issue.

It pointed out that agreements reached by the council would be binding.

The council adopted the landmark agreement after a series of talks among BSP and DOLE on the side of the government, representatives from banks as well as labor unions on the side of the private sector since 2008.

Various parties have been trying to harmonize the regulations on outsourcing currently covered by BSP Circular 268 and DOLE Department Order 18-02 that contain conflicting provisions on outsourcing in the banking industry.

The move to craft new guidelines was prompted by grave concerns from labor unions on the outsourcing of jobs of regular workers in the banking industry in the face of very liberal provisions in BSP Circular 268.

The BSP has identified areas that “will effectively be deemed as inherent to a bank.” These areas are deposit-taking, lending, management functions, activities covered by specific guideline or license, compliance functions, internal audit, and risk management.