No more executive order on contractualization

Duterte to certify bill on security of tenure

MANILA, Philippines — President Duterte is tossing to Congress the proposed ban on short-term employment.

Instead of signing an executive order (EO) banning contractualization, the president will just certify as “priority” pending legislation on security of tenure, Labor Secretary Silvestre Bello III said yesterday.

The certification will be Duterte’s Labor Day gift to workers, Bello said.

The development is seen to placate worried employers but spark protests from militant labor groups, which had expected Duterte to deliver on his campaign promise of putting an end to contractual employment, commonly known as end-of-contract or “endo.”

“Instead of an EO, the president is issuing a certification as priority the pending bill on security of tenure, which mirrors the proposed EO the president is supposed to sign,” Bello said at a press conference.

On Labor Day, Bello said Duterte would come out with “some dramatic issuances,” including a package of economic and social benefits for workers.

The House of Representatives approved on third and final reading House Bill No. 6908 on security of tenure in January this year. HB 6908 is an amendment to Presidential Decree No. 442 or the Labor Code of the Philippines. 

Bello said the security of tenure bill, if enacted into law, would be better than an EO against endo as the measure carries stricter guidelines and imposes stiffer penalties on violators.

He said labor groups have already been informed of the president’s decision, but might still be invited to a meeting with the Chief Executive
 before May 1. Once certified as priority, the measure on security of tenure is expected to breeze through the Senate.

“The House of Representatives already approved the proposed measure while the Senate is just awaiting input from the executive. So the certification from the president will be a signal for the Senate to give it priority,” Bello explained.

Senate President Aquilino Pimentel III said Duterte was right about letting Congress handle the task. He promised to expedite the passage of a related measure in the chamber.

“The policy on what types of employment we will allow in the Philippines; whether regular employment, whether provisionary employment and other types of employment; all of these details actually are part of legislative policy. This should be in a law and not through an EO,” Pimentel said.

Bello said the DOLE had submitted to the Office of the President three drafts of the proposed EO addressing the issue of contractualization.

The contentious provision of the three drafts, Bello said, is the definition of the security of tenure. Labor groups want “security of tenure” defined as employment relation between worker and principal employer.

Business groups, however, are opposed to the definition and are pushing for removal of the word “principal.”

After a review of the three drafts, Bello said, the Office of the Executive Secretary found it all to be just a mirror of the pending security of tenure bill.

The proposed EO as well as the security of tenure bill, Bello stressed, were a reinforcement to the existing DOLE Administrative Order 174 meant to stop unlawful contractual employment like endo.

The controversy over contractualization had led to the resignation of labor undersecretary Dominador Say, who had been accused of favoring management.

But there were reports that Say was really on his way out due to allegations of corruption.

This was contradicted by the labor chief who vouched for Say’s good track record in the private sector.

“He is a lawyer so I don’t think he is capable of doing that (corruption), I don’t believe those reports,” Bello said.

He said labor groups should trust the DOLE’s strict enforcement of AO 174 as part of its campaign against unlawful contractual arrangements.

Bello’s idea

 At Malacañang, presidential spokesman Harry Roque said Duterte refused to sign an EO on ‘endo’ upon Bello’s recommendation.

“Since my last statement on this, I’ve had the occasion to find out, number one, that the position of Secretary Bello now is it is better to leave the matter of endo to Congress,” Roque said. He had earlier announced that an EO on endo would be signed on Labor Day.

Citing a report from the Department of Trade and Industry (DTI), Roque said the president had already delivered on his election promise to do away with endo.

He said the DOLE has beefed up the number of its labor inspectors from 200 to 500 to go after businesses resorting to the prohibited practice.

“There is a distinction, however, between service contractors who recognize their employees as regular employees albeit they perform work for another company. And that is the position of the DTI,” Roque explained.

“The position of Secretary Bello now, which I think is the position of Malacañang as well – is let’s see what kind of legislation Congress will finally be approving, noting that the matter is now pending in the Senate alone, because the House already passed its version,” he said.

Trade Secretary Ramon Lopez said Duterte is set to sign something after all on May 1 – but not an EO.

“There may be a pronouncement, but it’s not an EO. It’s true that there is something to be signed, but it may be a pronouncement or direction on contractualization, but not an EO,” Lopez pointed out.

“We have agreed internally that nothing will come out because no matter what we issue, it won’t satisfy what they (labor groups) want,” he added.

Lopez said the current Labor Code provides workers with the best protection while at the same time offering flexibility to employers.

“The bottomline is in other countries, they simply call it nontraditional employment, but it’s actually legitimate contracting. Look at ASEAN countries, it’s allowed so we should not move away from that. It’s a model that is acceptable worldwide,” he stressed.

Lopez earlier warned labor groups that insisting on direct hiring by principals and employers could backfire on them and ultimately cause harm to the economy.

“We have talked to a number of investors and they are saying that they would just transfer elsewhere or will just not bring the investments here,” he said.

Lopez said what is important is that Duterte has made good on his promise to stop the practice of illegal contractualization.

Hopeful for EO

For Sen. Joel Villanueva, it’s still his wish for Malacañang to issue an EO “to provide the framework and guidance for the implementation of a national policy on contractualization.”

“We should know the clear position of the executive on this matter. We want to ensure that what we are legislating is useful and effective,” Villanueva, chairman of the Senate committee on labor, employment and human resource development, said.

Pimentel said the concern of Villanueva could be taken up during the next Legislative-Executive Development Advisory Council meeting where the labor chief would be present.

“I will ask him (Bello). It doesn’t have to be an EO but what they want could be captured by law,” Pimentel said.

He stressed that ending endo is also a policy position of the ruling PDP-Laban.

Pimentel said employers groups should air their concerns at public hearings of the Senate on the issue.

According to Villanueva, his committee is finalizing its report in preparation for plenary debates.

“We will release the committee report as soon as we finish circulating the draft to the senators for inputs. The president’s certification will definitely help in the passage of a new law governing endo,” Villanueva said.

With the signing of an EO on endo now out of the question, the militant Kilusang May Uno (KMU) said it is mounting protest actions in the run-up to Labor Day to dramatize their disappointment.

“Duterte’s mockery of Filipino workers and of our legitimate demands will never be forgiven. On May 1, International Labor Day, hundreds of thousands of Filipino workers across the country will show their outrage over Duterte’s rejection of our demands for regular and decent jobs in a nationwide workers’ and people’s protest,” KMU chairman Elmer Labog said in a statement.

“This further proves that his tough talk against contractualization was a mere publicity stunt to woo workers’ votes, like all other traditional politicians,” Labog noted.

The Associated Labor Union (ALU) expressed belief it was not the president but his cabinet officials who wanted to stop the issuance of an EO against endo.

“This is not the president speaking. Bello and Roque are just pre-empting the president’s desire to sign a labor-drafted EO,” ALU spokesman Alan Tanjusay said.

“Workers will only have one wish to President Duterte as Labor Day gift to workers: sign the EO. It will be the best Labor Day gift ever,” he said. – Richmond Mercurio, Christina Mendez, Marvin Sy