Freelance protection bill needs fine tuning

CEBU, Philippines —  While the recent passage of proposed Freelance Workers Protection Act in the Congress spells good news for the growing Filipino freelancers, the bill however needs some fine tuning.

According to Cebu Chamber of Commerce and Industry (CCCI) vice president of Business Mobilization Michael Cubos, the House Bill 8817 is still “very vague and broad.

“The bill needs a clear cut definition of what a freelancer is,” he said.

But, despite these “wrinkles” that need to be polished, Cubos who also owns a call center firm and other startup companies, said this is a welcome development for the growing number of Filipinos working as freelancers.

“This will serve as a unified protection for them. This is also a welcome development because the freelancers in the Philippines have longed for representation and protection for so many years now that this is in place. This is great news for everyone,” he said.

The Freelance Workers Protection Bill or House Bill 8817 was approved on third reading on March 25, 2021.

One of the bill’s principal authors, Pangasinan Fourth District Rep. Christopher de Venecia, explained that  the bill seeks to  introduce numerous key provisions for the protection of freelancers, including those making written contracts mandatory when procuring their services as it also provides night shift differential and hazard pay.

About two percent of the country’s population are freelancers.

Cubos, who is also the chairman of the Cebu Business Month (CBM 2021) added that there is one big component which is missing in the bill—“that is the protection for online freelancers.”

He said online freelancers need to be protected too, as there are a lot of online freelancers in the country.

Cubos mentioned that based on a survey, the total registered Filipinos working in Upwork and Freelancer platforms have reached almost two million.

These online freelancers need to be protected too especially that majority of their clients are overseas.

 “It is not provided in the Act on how the government will help these online freelancers, whose majority of hiring party or clients are based abroad,” said Cubos.

Under the bill, the execution of a written contract between a freelancer and the hiring party is required, making the enforcement of freelancers’ rights easier and more accessible.

The proposed measure also states that freelance workers who are assigned to be present physically in the workplace or those in field assignments shall be paid a night differential of not less than 10 percent of one’s regular compensation for each hour of work performed between 10 p.m. and 6 a.m.

Meanwhile, the taxation provision of the measure, states that all freelancers shall register with the Bureau of Internal Revenue and shall pay their income taxes annually.

According to the bill, a person who commits any of the unlawful practices aggrieved by a violation of this Act may file a complaint with the Department of Labor and Employment, through the Undersecretary for Workers with Special Concerns, without prejudice to the filing of a civil action in appropriate cases.

Complaints about any violation of its provisions may be filed with the Department of Labor and Employment through the Undersecretary for Workers with Special Concerns. Violators of the Act shall be liable to pay a civil penalty ranging from P50,000 to P500,000.

In the outsourcing sector, freelancing is known as the “gig economy.”

The gig economy is composed of freelancer talents who work for various clients around the world through jobs brokers like Freelancer and Upwork.

Global Gig-Economy index record showed that the Philippines currently ranks sixth in the world and is the fastest growing market for the gig industry, with a 35 percent year-over-year growth in freelance earnings.